Inheritances and Divorce – Can the Family Court give my Inheritance to my Spouse in a Divorce?

Whether or not an inheritance will be subject to division in a divorce will often hinge on whether or not the spouse has a vested interest in the inheritance, meaning that they have a right to use of the funds currently. An inheritance in the possession of one spouse is considered part of the marital estate and is subject to division under M.G.L. c. 208, §34 (https://malegislature.gov/laws/generallaws/partii/titleiii/chapter208/section34) as part of divorce.

To the contrary, a future inheritance expected by one spouse, but not yet I that spouse’s possession is not included in the marital estate as an asset subject to division.  Expectancy interests include things like an interest in a will or a trust while the testator is still living. The future inheritance cannot be quantified and are speculative as the interest the spouse may inherit from a still-living person can be changed or eliminated at any time while the person remains living.

The court may, however, consider the high probability that one spouse will receive an inheritance at some point in the future when determining how to equitably divide the existing marital assets.  In doing so, the court may award a greater portion of the marital assets to the spouse who does not have an expectation that he or she will receive an inheritance in recognition that the other spouse expects to receive a future inheritance.

As addressed in the 2018 Massachusetts Appeals Court decision Frasca v. Frasca , the Court cannot assign a percentage of future inheritances one spouse may receive to the other.  In Frasca, the parties were married for approximately 34 years and lived an upper middle-class lifestyle throughout the marriage, funded in large part by the husband’s mother.  As part of the divorce judgment, the Probate and Family Court found that the wife was completely financially dependent on the husband and his family’s wealth and awarded the wife 35% of any future inheritances the husband may receive.   The husband appealed the judgment, arguing that it was reversable error to assign the wife a portion of his future inheritances as he had no vested interest in the inheritances at the time of the divorce, therefore they were expectancy interests not part of the marital estate subject to division as part of a divorce.  The Appeals Court agreed and reversed that portion of the judgment.

Pursuant to M.G.L. c. 208, §34, the court must take into consideration the following 14 factors when making a decision regarding the equitable division of a marital estate as part of a divorce:

  • Length of marriage
  • Conduct of the parties during the marriage
  • Age of the parties
  • Health of the parties
  • Station of the parties
  • Occupation of the parties
  • Amount and sources of income of the parties
  • Vocational skills of each party
  • Employability of each party
  • Estate of each party
  • Liabilities and needs of each party
  • Opportunity of each party for future acquisition of capital assets and income
  • Amount and duration of alimony
  • Present and future needs of the dependent children of the marriage

In addition to the mandatory factors listed above, judges may also consider the following two non-mandatory factors:

  • Contribution to marital estate
  • Contribution as homemaker

The Court still has considerable discretion in deciding what, if any portion of an inheritances should be divided as part of a divorce. If you have questions about inheritances and divorce the lawyers at Mansur Law Group can help you understand what your rights are and help your develop a strategy to protect your family’s wealth.

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Alimony After the 2017 Tax Code Changes

One of the givens for divorcing couples in the United States has always been the alimony is deducted from the payor’s income and includible in the recipient’s income for purposes of federal taxes. This structure provided some relief by way of a tax break for divorcing couples who would have to use the money that previously supported one household to support two separate households after a divorce. This worked because the recipient was often the lower income earner and would therefore pay less taxes on the income received as alimony than the higher income earner would have had it been includable in their income.

The Massachusetts Legislature used the tax treatment of alimony when drafting the 2011 Alimony Reform Act which stated that alimony should not generally be more than 30% to 35% of the difference between the parties’ incomes.

As of December 31, 2018, the federal Tax Cuts and Jobs Act of 2017 completely upended the way alimony is treated for federal tax purposes and eliminated the prior rule that alimony payments were deductible from the payor’s income and includable in the recipient’s income. This change in the federal tax code has made the percentages in the current Massachusetts Alimony Statute no longer fair or appropriate. The law is, however, still in force and theoretically the Probate and Family Court judges could use it in support of setting an order based on these old percentages.

The current consensus among most practitioners is that the new percentage range is likely somewhere between 23% and 28% of the difference in the parties’ incomes, but it’s not yet clear that the family court judges are in agreement with these parameters.

The Alimony Reform Act also contains language that says alimony should be based on the need of one party and the ability of the other to pay. Despite the fact that need has always been the touchstone of any alimony order the percentage guidelines provided an ascertainable standard that many litigants and lawyers relied on in resolving cases without the need of a trial on the issue of need.

This area of law which was previously settled is now in a time of upheaval and uncertainty. It’s not entirely clear how judges will handle these issues. If you are considering filing divorce or in the midst of a divorce you need to make sure that you align yourself with lawyers and tax professionals who understand the state of the law and how to develop a strategy that will ensure that the result is fair and equitable in light of these new changes.

The attorneys at Mansur Law Group view helping families deal with increasingly complex legal issues in our fast-paced world as a calling, not just a profession.  If you would like to learn more about our services please call our office today 978-341-5040.
 
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How Long Will Alimony Last – Alimony Modifications

Mansur Law Blog- Alimony

One of the primary functions of the 2011 Alimony Reform Act was to set guidelines for the length of alimony awards in Massachusetts. The length of the award is now tied to the length of the marriage. The chart below lists the presumptive durational limits for alimony awards based on the length of the marriage.

  1. Married 0 to 5 years: 50% of the length of the marriage
  2. Married 6 to 10 years: 60% of the length of the marriage
  3. Married 11 to 15 years: 70% of the length of the marriage
  4. Married 16 to 20 years: 80% of the length of the marriage
  5. Married 20 years or moreIndefinite term of alimony

These guidelines are not, however, set in stone. They are only a presumption that can be set aside when appropriate. The appropriate circumstances are defined by the court as when it is “in the interest of justice.” This is a rather vague term, but the court looks to the factors listed below to determine if deviation is appropriate.

  1. Age, illness, and health;
  2. Tax Considerations;
  3. The cost and availability of health insurance;
  4. Cost of life insurance;
  5. Sources and amounts of income from assets not already divided during the divorce;
  6. A party’s inability to provide for their own support because of mental or physical abuse from the abuser;
  7. A party’s inability to provide for their own support for other reasons, including a lack of employment opportunities; and
  8. Any other reason the court finds relevant and material.

The person seeking to continue alimony past the presumptive guidelines is the one who bears the burden of showing the court that the above factors apply to their circumstances. Unless there is a continuing disability or chronic illness that existed at the time of the divorce the court is required to look at the circumstances only at the time the request for continued alimony is made. This essentially means that there will need to be a change in circumstances that has arsine since the date of divorce to justify a continued payment of alimony past the durational limits listed above.

The attorneys at Mansur Law Group view helping families deal with increasingly complex legal issues in our fast-paced world as a calling, not just a profession.  If you would like to learn more about our services please call our office today 978-341-5040.
 
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Top 5 Reasons why a Military Divorce is Different from a Civilian Divorce

1. Service Members Relief Act. This act entitles those serving in the military and on active duty status to apply for a stay of divorce proceedings when because of their service there is a material effect on their ability to participate in the divorce. The service member can apply for a 90 day stay or longer depending on circumstances. In order to obtain a stay the service member must show (1) active duty status (2)that inhibits the service member’s ability to appear and defendant against the divorce (3) statement about when the service member will be able to appear (4) statement from the service member’s commanding officer stating that the members service prevents him/her from appearing and that leave is not authorized at that time. A service member can choose to waive these protections. It is important that if you know the service member is not able to participate in the divorce process because he/she is stationed overseas or does not know about the case that you not go forward without their participation. A judgement where a service member qualifies for the above protection can and likely will be declared void, and the case will start from the beginning. Massachusetts is also a one judge system so the judge may not appreciate an attempt to go around these protection.

2. Pension Benefits 10/10 Rule. In order for a spouse to qualify for an assignment of the service members pension the service member must have 10 years of credible service and the parties must have been married for at least 10 years. The amount assignable to the spouse is also capped at 50%. These restrictions are federally imposed so even though a Massachusetts Court has the authority to award pension benefits if the parties have been married less than 10 years, the order would not be enforceable. This just means that you cannot receive payment of these benefits directly from the Defense finance Accounting Service and will instead need to receive them from the service member.

3. Military Pay. A service member’s pay is made up of many different types of income. For example, all service members receive base pay depending on their rank, but they also receive what is called allowances. These allowances often make up the majority of the service member’s income, and typically include things like basic housing allowance (BAH), basic allowance for subsistence (BAS), combat pay, cost of living adjustments. These are just a few of the most common types of allowances, which should be included in the service member’s income for purposes of calculating child support and/or alimony.  The child support or alimony award, however, under Federal law cannot exceed 50-65% of the service member’s disposable earnings. This is not, however, likely to be an issue because Massachusetts child support guidelines come out to roughly one-third of the earner’s gross income. It’s also important to note that you do not need a court order from the probate court in order to get child support from a service member. Military regulations require a service member to support their children and spouse, so if you aren’t receiving any support you might consider reaching out to their commanding officer. The amount provided will also likely be more than a court would award.

4. Health Insurance. The health insurance plan provided to service members and their families is called TRIcare. There are no premium costs for this health insurance plan, but there can be considerable deductions and co-pays when using civilian hospitals. Massachusetts state law requires that a former employer continue to cover an ex-spouse so long as the employee does not have a self-insured health plan, meaning the health plan bears the cost of any benefit claims. TRIcare is governed by Federal regulations and therefore exempt from Massachusetts state laws requiring continued coverage, which means that after a divorce the non-serving spouse will have to obtain their own insurance and often times at considerable expense.

5. Child Custody. Disputes about child custody are the most difficult cases for parents, judges and attorneys, and military divorce cases add an additional layer of complexity. Due to the nature of the military a service member does not typically know when they are going to be deployed and has little control over where they are stationed. Service members typically spend three years at an assigned location. Once the three years are up they are often assigned to a new location. The longer a person has been enlisted the more say they have over their new assignment, but ultimately the military has the final say in where they are assigned. Frequent relocation can be difficult for anyone, and this is factor that must be considered by judges in determining custody arrangements. The courts are always looking to see what arrangement is in the best interest of the children, and although the courts certainly do not want to punish a person for service in the military, the lack of stability in the case of deployment or relocation is often a factor the can weigh against the military parent.

Keep in mind each case is different and there are no one-size-fits-all solutions. The above is not mean to provide specific legal advice, but rather give you an idea of the type of things you should be thinking about if you are considering divorce. If you would like to learn more about military divorces please call our office today 978-341-5040.

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Divorce: Marital Property and Trust Assets

Many people assume that money or other assets held in a trust are protected from an order of property division in a divorce, but that is often not the case. Even where a trust isn’t considered for purposes of actually property division it is often considered income for the purposes of calculating alimony and child support payments. It can also be used by a judge to determine what share of the marital estate each spouse should receive in the divorce.

Massachusetts family courts take a very broad view of what constitutes marital property. The most common types of marital assets include retirement accounts, bank accounts, the real estate and other tangible interests, but it also includes intangible vested and unvested interests, which for the purposes of this blog will refer to trusts.

Trusts come in all different forms, the differences typically relate to how the trust’s assets are distributed to its beneficiaries. A beneficial interest in a trust is either vested or unvested. If a beneficiaries’ interest in a trust is vested that means there are no additional conditions that need to be met for the beneficiary to receive the money. If a trust has not yet vested that means that there is something that must have in the future for the beneficiary to receive the assets of the trust.

Typically when a person’s interest in a trust has vested that means the person has a present ownership interest in the trust assets, and it’s that present ownership that converts a trust into marital property. Unfortunately the analysis of whether a trust is marital property does not end there.

Even when a person has the right to assets or income from the trust there could be other provisions that limit that ownership. A trust could be set up for not just your spouse’s interest, but for that of future generations to benefit from. If this is the case there are usually provisions contained in the trust which allow a person to use the trust assets, but not to sell them. It may also give them the right to receive income generated by the trust assets, but not to use the principal assets of the trust.

The court’s use a fairly simple sounding test to analyze whether a trust is marital property. However, its application is very fact specific and depends on the circumstances of each individual case, which makes it much less simple that it may initially appear. The test is (1) Is future acquisition fairly certain? (2) Is it subject to present valuation? (3) is the interest too speculative?

Even if a judge determines that a trust isn’t marital property that can be divided the judge can still use a person’s interest in a trust as a factor in deciding what share of the marital estate each party receives. Massachusetts is what is called an equitable division state. This essentially means that any division of marital property between the parties is supposed to be fair. Fair does not necessarily mean there should be a 50/50 division, but rather a fair division, and to determine what fair means courts resort to the use a number of factors, which include among others the “estate, liabilities and needs of each of the parties and the opportunity of each for future acquisition of capital assets and income.” M.G.L.c 208, s. 34.

Where one spouse will be in a better financial situation because they will be the beneficiary of a sizable trust or inheritance then the court may decide to award the spouse who does not have this type of access a larger share of the marital estate.

The court’s can also use a present interest in a trust that is determined to not be subject to division in calculating child support or alimony awards.

Whether or not a trust and its assets will be subject to division is heavily dependent upon the facts of each case. The best place to start is to obtain the documents that were used to form the trust. This can be a complex analysis and you should seek the advice of a knowledgeable family law attorney to determine what your rights and interests may be in a divorce.

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Massachusetts Alimony Reform and Termination of Payments upon Retirement Age

In March 2012 the Alimony Reform Act went into effect and with it came new grounds for termination of alimony. One of the most talked about grounds for termination was the payor reaching social security retirement age of sixty-six and a half.

The relevant language can be found in G.L.c.208 §49(f) and reads in part;

“Once issued, General Term Alimony orders shall terminate upon the payor attaining the full retirement age when he or she is eligible for the old-age retirement benefit under the United States Old-Age, Disability, and Survivors Insurance Act, 42 U.S.C. 416, as amended and as may be amended in the future. The payor’s ability to work beyond said age shall not be a reason to extend alimony”.

Previously reaching retirement age alone was not grounds for termination of alimony. The proper procedure for handling these matters was through a complaint for modification, which would be filed when the payor retired or was about to retire and would be based on a material and substantial change in circumstances, i.e., the payor’s income was reduced because of retirement and they could no longer afford to pay the same amount.

Despite the new language contained in the Alimony Reform Act there is built into this section of the law grounds for deviating from the presumption that alimony should cease upon the payor reaching retirement age. Deviation may be done for “good cause” shown. The factors relevant to determining good cause can be found in G.L.c.208 §53(e) of the Alimony Reform Act. :

“(1) advanced age; chronic illness; or unusual health circumstances of either party;

(2) tax considerations applicable to the parties;

(3) whether the payor spouse is providing health insurance and the cost of health insurance for the recipient spouse;

(4) whether the payor spouse has been ordered to secure life insurance for the benefit of the recipient spouse and the cost of such insurance;

(5) sources and amounts of unearned income, including capital gains, interest and dividends, annuity and investment income from assets that were not allocated in the parties divorce;

(6) significant premarital cohabitation that included economic partnership or marital separation of significant duration, each of which the court may consider in determining the length of the marriage;

(7) a party’s inability to provide for that party’s own support by reason of physical or mental abuse by the payor;

(8) a party’s inability to provide for that party’s own support by reason of that party’s deficiency of property, maintenance or employment opportunity; and

(9) upon written findings, any other factor that the court deems relevant and material.”

One of the first cases to test the limits of a Judge’s ability to deviate from the presumption that alimony should terminate upon reaching full retirement age was Green v. Green, 84 Mass. App. Ct, 1109 (2013). In this case the wife was granted alimony until such time as the husband actually retired, and that decision was based on the fact that the wife was dependent upon the husband for support, due to her age and poor health she was not employable and likely would not be able to acquire her own assets in the future.

The laws on Alimony are new and as such have not been fully tested. It is important that you consider all the relevant factors and speak with an attorney knowledgeable in this area of the law before you decide to take action. These changes in the law also require litigants currently going through the process to undertake careful planning and preparation to protect future needs and interests of the parties.

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Changes to Massachusetts Child Support Guidelines and Calculations

On August 1, 2013 the Chief Justice of the Trial Court released new child support guidelines, which appear to attempt to promote greater responsibility of the non-custodial parent in a child’s life by drawing a direct correlation between the amount of support paid by the non-custodial parent to the amount of time that parent spends with their child on a regular basis. The new guidelines also clarify and modify other important issues outlined below.

1.       Welfare Benefits Not Income Under New Child Support Guidelines

Child support is based on the combined gross income of the parties. Traditionally, welfare benefits were included as income under the guidelines, but the new guidelines specifically exclude Transitional Aid to Families, SNAP, and SSI benefits from income calculations. SSDI, however is still included in the definition of income because it’s not based on the recipient’s income but is instead a monthly benefit based solely on your social security earnings.

2.       Changes to How Overtime is Considered

Whether or not to consider a parent’s second job as income in the child support guidelines rests solely in the Judge’s discretion. Judges have the ability to consider some, all or none of the overtime income a parent earns. There is also now a presumption that when a parent obtains a second job after a child support order has entered that it will NOT be included in that parent’s gross income for the purposes of calculating child support.

3.       Changes to Attribution of Income

The changes to attributing income to an unemployed or under employed parent are relatively minor, and are likely meant to take into consideration the fluctuating job market. As one of the relevant factors relevant to a Judge’s findings that a parent is purposefully earning less than they otherwise could a Judge must also consider the availability of employment  at the parent’s previous income level.

4.       Incorporates Changes in the 2012 Alimony Reform Act

The 2012 Alimony Reform Act made it clear that the same income used for child support could not also be used to calculate an alimony award. The new guidelines have adopted this language, and further added that the result of alimony and child support should be calculated in a way that is most equitable to the child. For instance, it might make sense to calculate alimony first and then child support based on the potential tax benefits and greater availability of income that could result. Judges have a considerable amount of discretion in this area, which it makes it all the more important to engage financial professionals who can help maximize a family’s financial resources.

5.       Changes to Calculations Combined Income Exceeds $250,000

Where the combined gross incomes of the parents is more than $250,000 per year Judges have a considerable amount of discretion in determining how to allocate the remaining income

6.       Percentage of Child Support Based on Parenting Time

This appears to be the most significant change to the guidelines. Under the new guidelines a parent’s child support order is much more closely tied to the amount of time the parent spends with his/her child. The old guidelines were either based on a 70/30 parenting arrangement, or a shared 50/50 custody arrangement. Where there was shared 50/50 split the parent with the amount of support paid by the higher earning parent was significantly reduced. The old guidelines did not take into account a less than 70/30 split or a split where one parent was doing more than 30% but less than 50%. Under the new guidelines these the court have been granted discretion in ordering a higher child support order where one parent is involved less than 30% of the time in a child’s life. There is also a new formula for calculating support where there is a split between 31-49%. The new formula requires that the child support guidelines be run first as though the custodial parent is the recipient of child support and then as though the parties share custody equally, and then average the two numbers together.

7.       Standards for Modifying Child Support

The standard articulated by the Court of Appeals earlier this year in Morales has been included in the guidelines, and clarifies that a complaint for modification of support can be filed any time there is a difference between the guidelines and a current order.

However, if the Department of Revenue (DOR) is bringing your case forward for you and the order is less than 3 years old then in order to do so you will also need to show a material and substantial change in circumstances.

8.       Deviation from Guidelines

There have been three new line items added to the factors a judge may consider in deviating from the presumptive guidelines order, they include the following:

I.     Where one parent’s health insurance expenses are extraordinary;

II.    One parent is paying child care related costs that are disproportionate to their income

III.  Where the non-custodial parent is spending less than 30% of the time with the child.

This blog post is only meant to highlight to the changes in the Child Support Guidelines if you have questions about your particular circumstances you should consider speaking with a child support lawyer.

You can also calculate your support amount by going to the MA DOR website here.

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Prenuptial Agreements

Let’s face it there is nothing romantic about a premarital agreement. When people ask you about your wedding planning I can guarantee they are not asking you how your prenuptial agreement negotiations are going.  Generally, most people are entering into a marriage because they are in love and the last thing they want to think about as they are preparing to head down the aisle is the marriage ending.

Prenuptial Agreements

Prenuptial Agreement

Unfortunately, the reality is that nearly half of all marriages end in divorce, and while its true most marriages are based on love and mutual respect, it is also true that at the core of any marriage is a financial partnership.

A premarital agreement is a contract entered into by two people who intend to get married. The contract outlines both parties’ rights should the marriage end. The agreements are most often used when one or both of the parties is seeking to keep a particular asset out of the marital estate, where there is a sizable difference between the income and assets of the parties, or where one party has the possibility of accumulating assets in the future, like a large inheritance.

In order to have a valid and enforceable premarital agreement the agreement needs to be fair and reasonable at the time it was signed and fair and reasonable at the time of the divorce. This is what most lawyers call the “then and now” test.

Fair and Reasonable at Time of Execution

  1. There must be a full and accurate disclosure of both parties’ financial situations.  Every asset should be disclosed, along with the value of each asset. This includes any expected inheritance or assets that a party expects to acquire in the near future.
  2. Both parties should have their own independent legal advice. If one party has substantially less income and/or assets and is not able to afford an attorney the other party should provide funds for that person to hire their own attorney. You should not recommend an attorney for that person to use and the funds provided should be on par with what the higher income party is paying their attorney.
  3. The sooner the better! The closer you get to the wedding date the more likelihood there is that your agreement will not be found to be valid. You want to make sure that it doesn’t look like one of the parties was forced to sign because the only other option was cancel or postpone the wedding.

Fair and Reasonable at Time of Dissolution

  1. This is a relatively easy standard to meet for most couples. The courts have interpreted this statement to mean that the agreement will be upheld so long as one of the parties is not left without enough income or assets to be self-supporting.
  2. Prenuptial agreements also have their limitations and terms relating to custody, visitation and child support will not be enforceable unless the parties agree to the terms at the time of divorce, and the courts find them fair and reasonable under the Massachusetts laws that would be applied at the time of the divorce.

Record your Agreement

  1. If your prenuptial agreement has an impact on property rights your agreement and asset schedule should be recorded at your local Registry of Deeds. This makes the agreement enforceable as to future creditors.

As someone who has experienced the process of wedding planning I know that those bridal checklists don’t include sitting down with your lawyer and negotiating a prenuptial agreement, but they should. I get calls from people all the time whose family or friends have finally convinced them to talk to an attorney, but it’s usually only a week or two before the wedding, and that can create serious issues regarding enforceability. Prenuptial agreements should be right at the top of the list next to booking your venue.

 

 

 

 

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Grandparent Visitation in Massachusetts

The nuclear family with a father who is the primary wage earner, the stay-at-home mom and 2.5 kids is no longer attainable for many families. It’s an ideal that for the majority of families does not fit their lifestyle or their needs. The economy as well as changing views on women’s roles, families, divorce, and having children outside of marriage has caused many single and married parents alike to enter the work force.

With more parents working many families are in desperate need of childcare.  A study released in 2012 by Childcare Aware of America estimated that the cost of child care for one child in Massachusetts was $14,980.00 per year, which for many can be way too expensive, especially if they have more than one child. To cover the gap many parents are turning to grandparents for help

Grandparents have been playing a much larger role in their grandchildren’s lives, with approximate 60% of grandparents reporting that they provide regular childcare for their grandchildren. This rise in grandparent participation has created some interesting family law issues.

Grandparents who have a falling out with one or both of their grandchildren’s parents who as a result are denied access to their grandchildren may file a claim for grandparent visitation with the child(ren) under M.G.L. c. 119, §39D, which states the following:

“If the parents of an unmarried minor child are divorced, married but living apart, under a temporary order or judgment of separate support, or if either or both parents are deceased, or if said unmarried minor child was born out of wedlock whose paternity has been adjudicated by a court of competent jurisdiction or whose father has signed an acknowledgement of paternity, and the parents do not reside together, the grandparents of such minor child may be granted reasonable visitation rights to the minor child during his minority by the probate and family court department of the trial court upon a written finding that such visitation rights would be in the best interest of the said minor child; provided, however, that such adjudication of paternity or acknowledgment of paternity shall not be required in order to proceed under this section where maternal grandparents are seeking such visitation rights. No such visitation rights shall be granted if said minor child has been adopted by a person other than a stepparent of such child and any visitation rights granted pursuant to this section prior to such adoption of the said minor child shall be terminated upon such adoption without any further action of the court.”

The legal standard for awarding a grandparent visitation with their grandchild is that it is if visitation were not awarded it would cause the child significant harm by adversely affecting the child’s health, safety or welfare. This might sound like a relatively easy thing to show, but it is not.

There is actually a presumption against awarding a grandparent visitation over the objection of the child’s parent. The court assumes that a parent is acting in their child’s best interest when they refuse a grandparent visitation with their children, and will only go against the parent’s wishes in extreme circumstance.

To meet this burden the court is usually looking for either a significant pre-existing relationship between the grandparent and the child, or  if there is no significant relationship that denying visits would somehow jeopardize the child’s health, safety or welfare.

Not just any pre-existing relationship will be good enough to obtain court ordered visitation. In these situations the court is looking for a relationship similar to that of a de facto parent. This maybe satisfied if the child has lived with the grandparent for a length of time and the grandparent regularly contributed to the child’s care.

There are also rare circumstances where although there is no pre-existing relationship, but denying visitation would harm the child. There was a case in 2007 SHER vs. DESMOND in which the court awarded visitation to a grandmother that had never met her grandchild. In that case there was evidence that the father was incredibly abusive to the mother and that he may have had something to do with her disappearance. In that case the court felt that the grandmother needed to be in the child’s life to make sure the father was not also abusing the child.

In addition to the high burden of proof required to win visitation with grandchildren there is also a high burden of information that must be contained in the original petition for visitation. The petition requires a significant amount of detail explaining the factual basis for a petition.

If you are considering filing a petition for grandparent visitation you should meet with an attorney to at least make sure your petition meets the minimum standards, and make sure you have a decent case, because if you are not going to win you may only succeed in estranging yourself further from the child’s parents by causing an unnecessary legal battle.

 

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Why the 401 Financial Statement is the Most Important Document in your Divorce

The Rule 401 Financial Statements are pink fill-in-the-blank forms. They are very unassuming, mundane looking things, especially the short form for people whose income is under 75K per year. Most people have filled out longer forms than these at their doctor’s office in under 15 minutes, and those forms are so the doctor doesn’t accidentally cut off the wrong leg or trigger some traumatic allergic reaction.

The only reaction I typically see to the financial statement is boredom, but I am here to warn you that not giving the financial statement the attention it is due could be financially traumatic. My clients are always amazed at how much work goes into preparing the financial statement, especially the first one.

The financial statement is one of the most, if not the most, important document you will file in a divorce action. It is so important because it lays out your entire financial situation in one place. It lists all your income, assets, expenses, and debts. It shows the judge what kind of lifestyle you led during your marriage, and what your financial reality is today. It also demonstrates to the court what your financial needs are going forward.

The other major reason it is so important to get the financial statement right is that if your case goes to trial you will be grilled on every aspect of the document by your spouse’s attorney. Any inconsistencies in the document or between the document and the testimony could make you look like you are lying to the judge and could result in the judge making financial decisions that don’t accurately reflect your situation.

Top 5 Mistakes to Avoid

  1. Handwriting your financial statement. I cannot tell you how many financial statements I get from other attorneys that are handwritten in court on the day of a hearing. When I see this I immediately assume the document is wrong and I assume they are lying. Judges also hate this for the same reasons. If you hand wrote your financial statement in court that day that signals to the judge that you did not do the proper research necessary to fill out the document and that you do not respect the court. Remember, you are signing this document under the pains and penalties of perjury.
  2. Statement does not Match Tax Return. This is most important for self-employed individuals. Most self-employed individuals fill out a schedule C when they file their taxes that is used to deduct business expenses from their business wages. The financial statement has a similar mechanism called the schedule A. It also allows you to deduct ordinary and necessary business expenses from your gross income in a more detailed fashion. If the two documents don’t match, at least closely, it opens you up to questioning about inconsistencies, which can make you look like you are lying and/or hiding something. Also, the judges are mandatory reporters so if it is clear you are lying on your taxes they are obligated to report that to the IRS.
  3. Expenses outpace income. The financial statement allows you to itemize your weekly expenses. For example, if your income is listed as $700 per week, but you list your expenses as $2,000 per week that is a huge red flag! Your expenses will typically match up relatively closely with your income, but if they don’t you better explain how you are paying those expenses. You can use footnotes to explain where you are getting the money.
  4. Double Dipping. This is another common mistake self-employed people make all the time. This most commonly happens when people list expenses on the schedule A to deduct them from their business income, and then also list them under weekly expenses. The most common items are phone, vehicles, and home-office expenses. This also sometimes happens when people list something as a weekly expense and then also list it as a liability.
  5. Not using footnotes. Footnotes are great when you are trying to explain anything. For example, say you were not the person in charge of the household finances and you have no idea how much you spend a week on food, or how much the electric bill and heat bill are every month, but you know going forward you will have to pay it. What you would do in those circumstances is with the use of a numbered footnote explain that the numbers are estimates. Footnotes will not only show that you are prepared and respect the court’s time, but it will also make you appear honest and forthright

Many of these mistakes can be avoided with the proper planning and attention to detail. One mistake I see frequently is that people are often being misclassified as 1099 independent contractors or executive employees by their employers.  This is sometimes done to avoid having to pay unemployment insurance or workers compensation insurance, or to avoid having to pay the employee overtime, and can have serious repercussions to an employee. If you think this is happening to you then you should consult a qualified Wage & Hour Attorney.

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