Posts Tagged ‘marital property’
Tips for Your First Meeting with Your Family Law Attorney
Many people feel that they have taken the first step towards a new life when they schedule their first meeting with their family law attorney. It can be a nerve-wracking experience and someone may feel nervous at the onset of a divorce or custody case. Television shows and movies play up the “drama” of contested courtroom battles. Sometimes these fictional stories mimic reality, but the vast majority of cases can be settled relatively amicably. Regardless of a case’s path, your first meeting with your family law attorney is important.
At the first meeting, you and your attorney will discuss your goals for the case. You should spend some time before the meeting thinking about your goals. It is helpful to make a list and bring it to your meeting so you do not forget to tell your attorney any important points. Your attorney can also help you develop your goals after you are more informed about the law and your situation. One good way to save money in your case is to determine your goals early in your case. You may incur more attorneys’ fees if you take one position, but change it at a later date because your attorney may need to change his or her litigation strategy.
If you will be involved in a divorce or custody action, your financial information will be very important. You should save your earnings statements/pay stubs, financial statements, such as credit card statements, bank records, mortgage statements, etc. These documents are often requested during a divorce or custody case, and you can save time and money if you are able to produce them right away, rather than having to search high and low for a document you might have thrown away. You should bring these to your first meeting with your attorney.
Being organized in your divorce or custody case is essential. If you are not a naturally organized person, now is the time to develop good organization skills. Your attorney should keep track of deadlines, but it is also your responsibility to be aware of what you need to do in order to comply with these deadlines. You will likely be informed in writing of any deadlines you need to meet. You will receive copies of important documents and letters, and you should have a secure place to store these documents. Consider buying an “accordion” folder with many pockets that will be solely devoted to your divorce or custody case. You should have this folder by the first meeting with your attorney because he or she will likely give you papers to take home that day. You should also maintain either a paper or electronic calendar so you can keep track of court dates and deadlines.
Being involved in litigation is not a passive experience. Your attorney is there to help you through the process, and you must also do what you can to help your case succeed by carefully considering your attorneys’ advice. If you have any questions about your divorce or custody case, call Chicago divorce attorneys The Witt Law Firm, P.C. at (312) 948-9884 or email info@thewittlawfirm.com.
The above blog post does not constitute legal advice. Please discuss your specific rights with an attorney in your jurisdiction.
Defining Marital and Non-Marital Property
One of the most important tasks for Illinois courts in a divorce case is to divide the divorcing parties’ property. Before a court can divide the parties’ property, it must first determine whether property is marital or non-marital.
Illinois law presumes that any property acquired by a spouse during the marriage is marital property. This may include earned income, personal property, cars, real estate, investments, etc. Contributions to retirement accounts are also presumed to be marital property. Property may be marital even if it is titled in only one spouse’s name. Illinois courts divide marital property in an equitable manner. This does not necessarily mean that the court will divide the property equally in half between the parties. One party may be awarded a larger portion of the marital property if the court believes such a division to be appropriate under the circumstances.
Illinois law also outlines certain categories of non-marital property. A court can assign a party’s non-marital property to him or her after the divorce. Non-marital property includes the following:
1. property acquired by gift, legacy or descent;
2. property acquired in exchange for property acquired before the marriage or in exchange for property acquired by gift, legacy or descent;
3. property acquired by a spouse after a judgment of legal separation;
4. property excluded by valid agreement of the parties;
5. any judgment or property obtained by judgment awarded to a spouse from the other spouse;
6. property acquired before the marriage;
7. the increase in value of property acquired by a method listed in paragraphs 1 through 6 of this subsection, irrespective of whether the increase results from a contribution of marital property, non-marital property, the personal effort of a spouse, or otherwise, and it may subject to the right of reimbursement;
8. income from property acquired by a method listed in paragraphs 1 through 7 of this subsection if the income is not attributable to the personal effort of a spouse.
A good family law attorney will be able to gather the property information in order to properly classify property as marital or non-marital. The process of gathering this information is called “discovery.” Occasionally, information revealed in discovery can help a party argue that non-marital property should be turned into marital property and be subject to division by the court. This is one of the reasons why it is important for people to conduct discovery in divorce cases.
If you have any questions about classifying property as marital or non-marital, call Chicago divorce attorneys The Witt Law Firm, P.C. at (312) 948-9884 or email info@thewittlawfirm.com. The above blog post does not constitute legal advice. Please discuss your specific rights with an attorney.
Valuing Businesses In Divorce
Valuing a business in divorce can be a very complex undertaking. Often a spouse’s interest in a business is the largest asset in the marital estate. The three commonly used business valuation methods are: the income approach, the asset accumulation approach and the market approach. The calculations and adjustments that need to be made in valuing a business depend in part upon what type of legal and tax structure the business has. LLCs are the most popular structure for new businesses and LLCs often chose to be taxed as a partnership. Partnerships are taxed differently than S corporations and C corporations. Other differences between these entities are the ownership restrictions placed on S corporations and the the greater flexibility LLCs have in allocating income to owners. Considerations with respect to valuations include: tax affecting the earnings; the existence of ownership restrictions; the cash flow available to owners; the impact of a deficit restoration obligation; and, unrealized capital gains. If you have questions about valuing a business in a divorce case, call me — Chicago divorce lawyer Tanya Witt at (312) 948-9884 or email info@thewittlawfirm.com. The above blog post does not constitute legal advice. Please discuss your specific rights with an attorney.
Protecting Retained Earnings From Distribution In Divorce
In divorce cases, when one of the spouses has ownership interest in a closely held corporation the retained earnings held in the corporation can be a point of contention. The issue of retained earnings may be particularly scrutinized when the spouse with the ownership interest in the corporation is the sole or majority shareholder or has the authority to determine his salary, pay dividends and decide the amount of earnings to retain. See In re Marriage of Lundahl, 396 Ill.App.3d 495 (1st Dist. 2009). Typically, if an ownership interest in a closely held corporation is nonmarital property then the retained earnings of that corporation would also be nonmarital property. However, there are arguments that the spouse without the ownership interest could make a claim for reimbursement to the marital estate. One of these arguments is that the spouse with the ownership interest made significant efforts to the corporation that caused substantial appreciation in the value of the company and was undercompensated for those efforts. Further, a spouse without an ownership interest could have an argument that retained earnings are marital property when the company did not have a history of retaining earnings at that level and there was no legitimate business reason for doing so. If you have questions about retained earnings and marital assets, call me — Chicago divorce lawyer Tanya Witt at (312) 948-9884 or email info@thewittlawfirm.com. The above blog post does not constitute legal advice. Please discuss your specific rights with an attorney.
Accurately Splitting the Tax Bill Between Seller and Buyer
In Chicago, when a property is sold, at closing the seller pays the buyer a property tax credit that is usually prorated based upon 110% of last year’s tax bill. When the actual tax bill is received, usually months later, sometimes the buyer received too large of a tax credit from the seller and other times the seller did not pay the buyer enough. In Florida and some other states, the parties usually sign a Tax Proration Agreement at closing which provides that when the actual property tax bill is received, it will be prorated based upon the days the seller was the owner and if the estimated proration that seller paid at closing was too low, the seller will pay the buyer the difference so that buyer receives an accurate, exact amount. A Tax Proration Agreement allows the buyer to receive an accurate proration and not just an estimate of 110% of last year’s bill. It is the only way to have a truly accurate and fair proration. If the seller cannot be located or refuses to honor the agreement, the buyer would have to legally pursue the seller. Depending upon the amount at stake, some buyers will do this and some will decide it is not worth the effort and expense.
