Pension plans are usually divided in one of only two ways: “cash out” or by Qualified Domestic Relations orders (QDROs). The latter is the most common way through which pension plans get handled. Under this scheme, it is ordered by the court that at the time of retirement of the employed spouse, the other one will be the recipient of a percentage of every pension check. This percentage is arrived at by dividing years when the spouses spent together in their once home as wife and husband by total number of all years when the spouse who is employed had participated in pension plan. The result amount of that division is community property percentage of pension plan. To give an example, if a husband has put in 20 years of his monetary contributions to a pension plan, and 10 of the coinciding years he lived with the wife, the share of the pension plan will be about 50 percent. In such a case, the wife will have 25 percent of the pension checks of the husband.
Money plan
As per reservation of jurisdiction, the spouse considered a non-employee could elect to receive her or his share of the pension benefits of the employee spouse at earliest time when the employed spouse will retire. It means that in the case of the employed spouse electing not to retire at earliest opportunity, that spouse must pay the non-employed spouse what the latter would have got in case the employed spouse would have retired. To give an example, if the husband becomes eligible to retire at 55, but elects not to retire in that age, his ex-wife could demand that he provides her the amount of money she would have received if he retired during that age. It is to be mentioned that in case the wife selects this option, she will not receive any increases due to higher cost of living after that date.
QDRO
The 1984 made Federal Retirement Equity Act created “Qualified Domestic Relations Order”. In this system, the court gives orders regarding the retirement plan of the spouse. The Federal law states that the employer must comply with the order terms. The QDRO preparation is complicated and time consuming. It is also expensive. However, the QDRO is an essential step in dissolution process. A number of companies have been created for the sole aim of making them.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
While you might find it tempting to conceal a certain part of your assets from your divorcing spouse, it is not really a good idea when it comes to legal implications of the same. Similarly, if in case you suspect that your partner is not providing complete disclosure of his or her assets for the purpose of distribution in a divorce, you must understand that the state laws of California stipulate stringent legal actions against such an act. When it comes to rectifying the omission of an asset disclosure, there are typically two aspects that are taken into consideration: the time of discovery and whether the omission was intentional or a mistake.
Asset omission through a mistake and discovered after the final court order
In case a spouse has inadvertently failed to make a complete disclosure of his/her assets, and it is discovered after the final judgment has been announced, the court has the right to alter the order and divide the asset as per the stipulates of the Californian State laws.
Intentional omission discovered before the final court order
Speaking of the obvious, an intentional concealment of an asset by a divorcing party is treated quite differently as in the case where the omission was an honest mistake. According to the Californian law, both the divorcing parties have the ‘fiduciary duty’ of serving a declaration of disclosure that contains all the information about their assets and debts to each other, failing which the guilty party will be faced with stringent corrective actions from the court of law. In some cases, an incomplete disclosure of an asset may also lead to the court ordering 100% ownership of the said asset to the other party involved.
Intentional omission discovered after the final court order
In the event that you discover an intentional un-disclosure of your spouse’s assets after the court has announced the judgment, the Californian law offers you the right to set aside the court order as ‘based on fraud’. In addition to this, you also have the right to file a tort action or the infringement of your rights, against your guilty partner.
The bottom line is that it is prudent to follow the laws of your state and provide proper disclosures of your assets and liabilities, in order to facilitate smooth and trouble free divorce proceedings. It is always advisable to be as transparent as possible in your case.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
Are you a divorced woman and are a bit overwhelmed by the amount if bills appear to simply pile up? If that is so, you definitely need some kind of financial guidance. After your divorce, your standard of living changes. So, finding a proper financial assistance, paying bills and organizing are some of the prime tasks you need to embark upon.
Why divorced women need financial help
According to an estimate, about 40 percent of the divorced women have a new standard of living after their divorce comes through. Though in many cases the alimony provided by an ex-spouse could pay for living expenses, that still may not be adequate to provide all the expenses and lifestyle that they were used to while being married. The alimony they get after the divorce may not be adequate to take care of all the bills.
Moreover, the condition is even worse for some divorced women who do not even know how to pay their bills since they did not do these tasks while married. So, they are at a loss where and how to start from as far as the question of paying the bills and organizing their financial things pop up. In such scenarios, these women require some handy tips for paying their bills so that they are on a right track.
Tips for divorced women to pay their bills
Collect all the bills that you have received in one place for each month.
Now separate these bills on the basis of their due dates or depending on the frequency of their payment, For instance, if you have to pay twice a month for some bills, you can make two different piles. One pile to be paid at the month’s beginning and the second pile to be paid at the end of the month.
Creating a monthly budget is very important so that you know how much monthly income is left with you after making the bill payments. This will also help you to make timely payment for your credit cards. So, paying the bills should be the first priority. You can then use the remaining money for the rest of the expenses.
Put all the checks for your bills in separate bill payments to be prepared for the month. In case you make your bill payments through banks, set up your payment in advance to avoid last moment tension.
After you get paid, mail your first lot of bill envelopes that are due for the month’s first half. You can repeat the same procedure when you receive your second paycheck.
Are you facing difficulty with writing checks? Do not worry as you can get online instructions to fill them. In case you are interested in making online bill payments, you should get in touch with your bank and find out whether they provide such services or not. If they are offering the service, their representative would definitely help you with the entire process. There are some companies that accept payments on their corporate websites or over the phones. You can get to know the details from the bills sent to you or by calling the payment center of the company.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
Marriage is not an easy relationship. There are several cases when couples started their married life with the best intentions but ended up getting divorced. There could be various reasons for which couples get divorced. Here are some of the most common reasons for couples ending up being in divorce court.
Extra-marital affairs or adultery
According to a report published by AARP, even today, adultery plays a big role in people filing for divorce. But, reports also claim that there are several reasons that lead to a spouse getting into an extra-marital affair such as unequal sexual urges, getting distant, having different interests, resentment and fury.
Gain in weight or obesity
Though it may appear as a surprising reason, unusual weight gain by one of the spouses is also known to be a major reason why couples get divorced. A survey conducted by Men’s Health magazine reported that when one of the spouses gains a lot of weight, it can come in the way of their marital bliss. If your spouse does not attract or get turned on to your body, there could be problems like resentment and rejection, which can be marriage-threatening issues.
Monetary issues
According to a report published by the American Journal of Sociology, when a husband is unemployed, it can be a major criterion for divorce. In other words, lack of or insufficient money can cause big problems in a marriage, often leading to a divorce. If a married couple faces financial on strainers, there could be a lot of stress. This can further lead to a lack of proper communication and constant arguing. There are many couples who have different views on the others’ spending habits. Relationships may undergo lots of stress where one controls or has the finances, which often end up in a divorce.
Lack of proper communication
Often you will hear people saying that proper communication is the key to a successful marriage. Many relationship coaches opine that negative communication or lack of communication may diminish feelings of romance and love between couples. When a couple stops having effective communication, marital troubles leading to a divorce are not unusual.
Abuse
Abuse can be either a spouse being physically or emotionally abused by the other spouse. These are a common reason why many couples get divorced. Verbal or physical fighting that happens frequently between couples may make their relationship volatile and eventually end up in a divorce.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
Late life divorces are increasing in number as more and more people live longer. A recent study has revealed that one in every four divorces are late-life divorces. Like any divorce, a late-life divorce can be hard hitting on the financial front. But a late-life divorce could ruin people with the best retirement plans.
The cost of living separately is much higher than the cost of living together as the number of accommodations and facilities double. In simpler words, an elderly couple that have been together for a long period of time would have likely planned their retirement together. When a divorce is filed, one of the spouses will have to move out and more often than not, have to plan separate occasions to meet other family members. All of this, could drive expenses up by 30 or 40 percent.
Anyone involved in a divorce will tell you that it is one of the most expensive scenarios to deal with. For people aged 50 or over, this could spell the destruction of their financial plan altogether. A financial planner or advisor needs to be consulted in order to understand the circumstances. This is especially true, if one of the spouses handled the finances throughout the marriage.
In some cases, retirement benefits might be more valuable than all of the couple’s other community property combined. This might form conflict on the division of the benefits. Some forms of benefits such as social security, military compensation, and workers’ compensation for disability are not considered to be community property and will remain with the individual after divorce.
Retirement Allocations
In California, retirement is considered to be community property that can be divided amongst both spouses. However, retirement divisions are handled outside of the usual divorce proceedings. A Qualified Domestic Relations Order (QDRO) outlines the division of the retirement funds. It is usually filed after the divorce judgment. The QDRO is needed to divide 401k, 403b, profit-sharing plans, tax sheltered annuities and other aspects.
During divorce proceedings, the QDRO calls for the equal division of retirement assets. However, mediation and negotiation can help spouses agree on different rates or division percentages. The QDRO is the final indicator of division of retirement benefits. Divorce attorneys often hire QDRO specialists to help segregation and division. Once both parties have agreed on the division of benefits, a QDRO is filed.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
Divorce can become a complicated subject, especially when debt becomes a part of it. If you are a married person, then you know what that means. There have been cases where one person walked away without paying a single cent while the other went bankrupt. It could be a nightmare for the one paying the debts.
How you handle debts after your split can have a major impact on your credit.
Debt on property
In states like California, both you and your spouse are liable for the debts incurred after you got married. It does not matter in whose name the account is. Both of you are responsible for the property purchased and the debt as to be shared. In other states, the debt is paid off by one person only. It might not sound fair but that is the law in those states.
Debt on credit accounts
The same goes for credit accounts as well. Since the credit was shared by you and your spouse, the debt too must be shared. Even if the divorce rules say that your spouse is responsible for paying the debt, you will still be a part of it. You miss the payments, and you become a defaulter. If you become a defaulter, then your credit score drops, making it harder to get credit in the future.
Handling joint debts
After you get divorced, make sure you close all joint accounts that are in your and your spouse’s name. Remove your spouse’s name from the authorized user list. Try getting the account converted into individual accounts if you can.
Try paying off as many debts as possible before the actual divorce. It will keep you prepared for any extra charges that might incur during your divorce proceedings.
Minimizing damage
When you close accounts, make sure that the credit accounts are in your name. Doing so will give you control over your money and you would not have to worry about any unknown debts.
It’s common among couples that one person borrows while the other spends. If you are one of them and you are on the spending side, then talk with your partner and work out a common ground. Understand that if your credit score is low, future lenders would not lend you money. Before you get divorced, try clearing as much debt as you can together.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
Gerald A. Maggio is a trained Riverside divorce mediator who has amicably resolved cases many cases out of court, as well as an experienced divorce and family law attorney. Mr. Maggio founded California Divorce Mediators in 2012 with the belief that although “not every marriage can be saved, every family can” and a mission to save families from the financial and emotional distress associated with traditional divorce litigation. California Divorce Mediators is located in Irvine, California, and serves the Orange County area and other counties in California offering divorce mediation, child custody mediation and mediation of other family law matters.
In the State of California, debts between a couple are divided into two types – community debts and separate debts. Community debts are those debts that are accumulated by both parties to the marriage during the marriage until the date of separation. These debts are to be equally divided between both the parties even if only one spouse was responsible for incurring these debts. Separate debts are those debts that were incurred separately by the parties before the marriage or after separation and belong to the individual spouses who were responsible for incurring them.
Treatment of debts in California between a divorced couple
All debts in the State of California are to be treated as community debts as California is regarded as a “community property” state. This is of course unless the parties to the marriage had entered into a prenuptial agreement before the marriage regarding the division of assets and debts between them in the event that they decided to get divorced. If there is no prenup, then the court equally divides all debts between both spouses equally.
However, there is one exception to this rule and that is when the total value of the community debts exceeds the total value of the community assets jointly held between the two spouses. In this case, the court will order for a higher portion of the debts to be borne by the spouse who earns a higher income or who is in a better financial position to pay off these debts.
Importance of the date of separation
In the division of community debts in the State of California during a divorce, the date of separation of the couple is extremely important as only those debts that were incurred before the date of separation will be included in the community debts and all other debts incurred post the separation date will be assigned to the spouse who individually incurred them and the burden of paying those debts post-separation will not be borne or shared by both spouses.
Deciding the date of separation is sometimes a difficult task especially when the couple is in total disagreement with each other. Two tests can help confirm the actual and legal date of separation between a divorcing couple in the State of California –
The first test is to determine the date of physical separation between the spouse, that is the date on which they began living or sleeping separately or the date on which one of either spouse moved out of the house.
The second test is to determine when either spouse expressed their clear intention to end their marriage. This does not include a trial separation.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
Alimony aka spousal support that is paid by one spouse in the form of financial support to the other for spousal maintenance. The purpose of spousal support is to financially help the other parent maintain a certain standard of living after divorce.
Since alimony payments are considered to be a form of income, it is tax deductible. However, there are many requirements without which tax cannot be deducted from alimony payments.
The paying spouse is entitled to tax deductions for payment of spousal support
The IRS allows the one who is paying for alimony to deduct such payments from his or her taxes. The recipient must also show the payments as a source of income. Tax deductions help both spouses save money and the IRS too can keep a track of the alimony being paid. It helps as supporting evidence when disparities in alimony payments take place. In some cases, it also helps spouses maintain a good relationship with each other which is important when children are involved.
Issues regarding spousal support and taxes
There are certain requirements without which alimony taxes cannot be applied.
During a divorce agreement, the alimony must be clearly mentioned. If nothing of this sort is mentioned in the agreement, then neither parent is responsible for paying any amount of money to the other parent.
Couples usually have to live separately at the time of alimony payments.
Conclusion
Alimony is an important part of divorce and both the paying and receiving spouse should be aware of how taxes get deducted from alimony. It helps save money and protects spouses from doing anything illegal. Also, unfair alimony provisions are also prevented. Since, tax deductions mostly depend on the paying spouse, keeping a good relationship helps. Alimonies are important and it helps one spouse maintain almost the same amount of lifestyle as the other spouse.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
Most divorces today are not only excessively time-consuming, but also financially devastating for both the parties involved. From the rising costs of counseling to the exorbitant per-hour rates of legal professionals, a divorce has become one of the most expensive legal affairs in the country. A typical divorce proceeding can cost you up to several thousand dollars and leave you with a huge gaping hole in your pocket. However, by having a solid plan and using your wisdom, you can spare yourself the additional stress of witnessing an empty bank account. Let us have a look at a few smart tips that can effectively help you curb your ruthless expenditure on your divorce litigation.
Avoid excessive communication with your lawyer
Your attorney will charge you for every hour that you spend with him. Every time you contact your lawyer for a trivial issue or question, you will be losing more money. The idea here is to limit your communication with the lawyer, and ensure that you prepare a list of questions that you wish to ask your lawyer in the next meeting. Instead of calling him up or dropping a mail every time a doubt pops up in your mind, you must wait until you have multiple points of a discussion with him. Also, try and keep all the relevant documents organized and within easy access, to avoid dropping in at your attorney’s office to resolve the issue of missing paperwork.
Try divorce mediation
Mediation is a cost effective and less time consuming way of obtaining a divorce, than a full blown court trial. If you and your spouse still have some level of amiability in your relationship and are ready to resolve the conflict with a mutual agreement, you can seek the legal counsel of a neutral third party known as a mediator to help you achieve a peaceful separation. Such uncontested divorce not only helps you find resolutions that are suitable for both the parties, but also minimizes the extra expenditure that might otherwise go into a lengthy court trial.
Avoid battling over assets that you do not really need
More often than not, in our ego and resentment for our ex spouse, we tend to fight over silly issues that do not even matter much to us. It is natural to fight for a piece of asset or property, just so that it does not go to your spouse who desperately wants to keep it. However, before wasting thousands of dollars over the ownership of assets that you really don’t care about, you must try and figure out whether this mindless expenditure is even worth it or not.
Most importantly, you must contest your divorce with an open and practical bent of mind, since after the storm subsides, you will be faced with the harsh reality of trying to start a new life with the little resources you are left with after an expensive divorce.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
You would be well aware of the fact that once you separate from your spouse and start a new life from scratch, you will need substantial financial support to pay your bills and maintain your regular standard of living. It is, therefore advisable, to organize your finances and assets in such a way that your spouse cannot obtain an undue ownership of what is rightfully yours. By devising a solid plan before you go on to file a divorce, you can legally protect your assets and rest assured that you will not be left with an empty bank account when the final verdict is announced. Here are a few ways in which you can protect your property and assets in the event of a divorce or a legal separation.
Organize your separate property
It is important to create an inventory checklist of all the items that have been given to you separately, to ensure that they do not get mixed up with your marital or community property. It may include any specific possessions such as jewelry or family heirlooms that have been directly inherited by you. You can also take photographs of the items on your separate property list, to prevent your spouse from claiming them on the grounds of obscurity. After preparing the catalog of your valuables, you can move them to a safe place so that you do not miss out on them in case you have to leave your marital home.
Gather proof of gifted or inherited possessions
It is a good idea to go up to the concerned people and request a written and signed proof to state that the items were solely given to you and not your spouse. The court of law demands evidential proof of every little thing that is brought forth to a trial. It will be easier and more convenient for you to prove your ownership of a separate property in front of a judge if you possess an attested statement to support your claim.
Sort out your rent and mortgage payments
The lending companies and landlords expect you to pay the monthly installments, regardless of what your present situation might be. If the situation arises you may have to move out of your marital residence before or after filing for a divorce. Although, you will still be obliged to make one-half of the mortgage or rent payments, this action of yours can be detrimental to your claim in the share of your home. It is therefore advised to have a peaceful and practical discussion with your spouse and reach a mutual agreement about who will be entitled to become the rightful owner of your marital home post-divorce.
If you are thinking of getting a divorce from your spouse, you should organize your finances right away, even before you file a petition in the court and proceed with divorce mediation.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
Pension plans are usually divided in one of only two ways: “cash out” or by Qualified Domestic Relations orders (QDROs). The latter is the most common way through which pension plans get handled. Under this scheme, it is ordered by the court that at the time of retirement of the employed spouse, the other one will be the recipient of a percentage of every pension check. This percentage is arrived at by dividing years when the spouses spent together in their once home as wife and husband by total number of all years when the spouse who is employed had participated in pension plan. The result amount of that division is community property percentage of pension plan. To give an example, if a husband has put in 20 years of his monetary contributions to a pension plan, and 10 of the coinciding years he lived with the wife, the share of the pension plan will be about 50 percent. In such a case, the wife will have 25 percent of the pension checks of the husband. 
Gerald A. Maggio is a trained Orange County divorce mediator who has amicably resolved cases many cases out of court, as well as an experienced divorce and family law attorney. Mr. Maggio founded California Divorce Mediators in 2012 with the belief that although “not every marriage can be saved, every family can” and a mission to save families from the financial and emotional distress associated with traditional divorce litigation. California Divorce Mediators is located in Irvine, California, and serves the Orange County area and other counties in California offering divorce mediation, child custody mediation and mediation of other family law matters. 
