Hoge Partners, PLLC

Louisville Family Law Blog

Finer points of property division in high-asset divorces

Individuals who are going through a divorce might have to deal with retirement accounts. These take special consideration because there are significant financial and tax implications if they are mishandled. For any qualified plans, such as 401(k)s, the only way to transfer the asset from one party to the other without having to face those is to have a qualified domestic relations order.

This court order outlines how to divide the account and identifies both parties. The court issues it and the plan administrator must accept it unless there are problems with it. When the plan administrator does note that something is amiss, a notice outlines the steps to take to correct the error. The QDRO is accepted once those errors are addressed.

What is a postnuptial agreement and why do you need one?

Few newlyweds exchange their vows with the expectation that their marriage will end in divorce. The start of the marriage is one of the high points in the union but at some point, life will test your relationship. While no one plans to get divorced, it’s no longer an uncommon event.

There are many reasons and ways that people choose to protect themselves from divorce. Some people will enter into a prenuptial agreement before the marriage, but postnuptial agreements also exists for the same purpose.

Create a peaceful and organized home for your kids

Every aspect of your child's life can have an impact on how they are shaped for life. One thing that parents need to do is to foster a sense of independence in them. You might remember when your kids went through the phase where they had to try to do everything alone. While you probably don't want to go back to that, they do need to know how to do things in the future.

The way you have your home organized can have an impact on your children, so it is best to think carefully about how you set everything up. The key here is to make it possible for them to do as much as possible for themselves without them having to struggle much. This doesn't mean that everything will be easy for them. It simply means that they have the tools they need to improve the chance of success.

Plan a prenuptial agreement carefully to preserve validity

A premarital agreement is something that you and your future spouse need to discuss. The terms have to be mutually protecting, and the document can't favor one person. It is necessary to ensure that you have everything in order with it because any errors can mean that it is thrown out when it is time for you to call on the protections it provides.

Because this document can't be signed in a rush, you should discuss it as early in the engagement as possible. This allows time to negotiate the terms and for both parties to thoroughly review it to ensure that it is set up in the agreed upon manner.

How will child support affect your taxes?

The new Tax Cuts and Jobs Act (TCJA) has left many Americans wondering about the impact on their taxes. You may have heard how spousal maintenance is no longer allowed as a deduction. As a divorced parent, you are much more concerned about how the new tax law affects those who pay or receive child support. Here is what you need to know.

Business valuations for divorce are complex

Running a family business with your spouse is sometimes a challenging situation. If you are going through a divorce with that person, you will have to make some tough decisions about the future. Before you settle on any single option, you need to have the business valuated. This can give you an idea of what's in your best interest from a financial standpoint.

There are two primary standards for business valuation, so you must find out which is being used for yours. These are the fair value and the fair market value. The fair value means that there aren't any discounts for lack of marketability or lack of control. The fair market value does include those two discounts, so it might be a much different value.

Is it possible to change a custody arrangement?

When your custody arrangement was originally set, the details of the arrangement were based on your situation, your spouse’s situation and your child’s needs at that time. However, life is always changing. Sometimes when life changes, it makes sense to change your custody arrangement too.

Although you or your spouse can seek modifications to your custody arrangement, there are some limitations. Typically, neither parent can seek modifications unless two years have passed since the current arrangement began. Even then, there must have been a significant change since then.

Encourage parent-child relationships after divorce

One of the most difficult situations for children is finding out that their parents are divorcing and that they are going to live with one parent most of the time. They might feel as though they aren't going to be able to have a relationship with the other parent. This isn't a good thing for the kids to have to deal with. Unless there is a history of abuse or something that would make the child unsafe while they are with the non-custodial parent, the custodial parent should work hard to encourage a positive relationship between the other parent and the child.

The relationship is so important that some courts will base custody decisions on how likely one parent is to encourage it. You must remember that what happens now will impact your children forever. This isn't the time to try to punish your ex for things that happened in the marriage. Instead, you have to put your energy into helping your children thrive and find the security they need now.

Beware of financial lies in the family business during divorce

Running a family business takes a lot of work. When you and your spouse work together on the task, you both are probably attached to the company. This is a good thing as long as the marriage is solid, but it can cause a lot of problems if divorce becomes a factor. If you are heading toward divorce and have a family business, you need to be aware of what's going on with the company.

There is a hidden danger in some family businesses when it comes to divorce. If one spouse handles the finances, the other one might not be aware of a phenomenon known as Sudden Income Deficit Syndrome (SIDS) occurring. Unfortunately, SIDS can directly impact the settlement you receive for the divorce and the decisions you make regarding the business.

Co-parenting requires close communication with your ex

A co-parenting relationship is one that is best for the children, but it is sometimes difficult for the parents. When you are in this situation, you have to take the time to think about what type of relationship you are comfortable having with your ex. If you're co-parenting, you will be working closely with them.

One of the most important points to remember when you co-parent is that you and your ex must have open communication. This can be handled in a variety of methods, including in person, over the phone or electronically. It might be necessary to set limits to when you will communicate unless there is an emergency. For example, you might say that from 8:00 p.m. until 8:00 a.m., only emergency calls are accepted. Be sure to abide by the rules you and your ex set.

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Louisville, Kentucky 40202

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