Divorce Archives - Challoner Law

Business appreciation may determine asset division outcomes

On behalf of Morna Challoner of Challoner Law posted in blog on Monday, October 2, 2017. Going through divorce will cause you to face many concerns. Some of the biggest apprehensions may relate to how property division will turn out and other possible financial impacts. As a business owner, you may feel particular anxiety when it comes to the potential of losing a portion of your company to your ex-spouse as part of the divorce settlement. Dividing business assets can often present challenges. In particular, valuing a business may not always go as straightforwardly as hoped, as many different factors could have an important role to play. You may want to better understand how active and passive appreciation could impact valuation. Active appreciation With active appreciation, your direct actions contribute to your company's value increasing. These actions could range from bettering the company through various growth efforts to creating and enacting business strategies that make your business a top competitor. In relation to divorce, value attributed to active appreciation during the time of your marriage will likely go through property division proceedings. Because of this factor, determining which portion of your company's value came from active appreciation and which came from passive appreciation may seem vital. Passive appreciation As the name suggests, passive appreciation involves an increase in business value with no effort from you. This type of appreciation often gets attributed to economic growth, industry growth, interest rate changes or demographic trends. The portion of business value associated with passive appreciation does not get divided during divorce proceedings. Determining active vs passive appreciation During the business valuation process, determining what value comes from active appreciation versus passive appreciation has its difficulties. Often, a professional evaluator's insight plays a role during this process. However, even a professional may have a challenging time [...]

admin2022-11-23T17:11:43+00:00Categories: Blog, Divorce, High Asset Divorce|Tags: Divorce, High Asset Divorce|

Will you have to pay a penalty when dividing retirement savings?

On behalf of Morna Challoner of Challoner Law posted in blog on Tuesday, December 5, 2017. Financially conscious couples tend to start saving for retirement early on in their marriages. Individual retirement accounts -- IRAs -- are popular choices when saving for the future, and they provide many benefits to future retirees. Divorce can complicate these savings though. Most California couples understand that they must divide retirement funds, but many are unsure of how to do so. Failing to consider the implications of improper withdrawals could result in both parties shelling out hefty penalties and/or taxes. Why can't we just withdraw the money and split it up? Savings and checking accounts can be emptied and split much easier than retirement accounts when necessary. You might feel tempted to do the same with your IRA to speed up the asset division process. Unlike IRAs, 401(k)s and other retirement savings, regular banking accounts rarely have associated penalties for withdrawing money. IRAs, on the other hand, have early withdrawal penalties that tend to be steep, as these intend to discourage people from dipping into their retirement savings. In almost every situation, early withdrawal leads to these penalties. Is there a way to receive payments from an IRA without facing penalties? Qualified domestic relation orders allow you to withdraw from your IRA without the typical associated penalties. Divorcing couples create QDROs during asset division, and may then make pursuant withdrawals and payments. On top of having a QDRO in place, you must pay any withdrawals directly to the intended individual. Paying off a debt on behalf of the other person will usually not qualify for penalty exemptions. This means if you purchase something, pay off a creditor or use the funds for anything other than a direct payment, you will pay penalties and any resulting taxes. [...]

admin2022-11-23T18:58:59+00:00Categories: Blog, Divorce, High Asset Divorce|Tags: Divorce, High Asset Divorce|

From beginning to end: A divorce checklist

On behalf of Morna Challoner of Challoner Law posted in blog on Sunday, December 24, 2017. You have reached the conclusion that divorce is inevitable. Now that you have made the decision and your feelings are out in the open, you may even feel as though a huge weight has lifted from your shoulders. For many, finally making the choice to divorce is the most difficult part. However, the process is far from over, and on the other hand, you may be feeling stressed and overwhelmed at the thought of what the coming months may bring. Regardless of your feelings, you're likely wondering what to do next. Where do you begin? While each divorce is different, there are certain steps that, if followed, should help you to remember the essentials and thus make the entire process smoother from beginning to end. Divorce to-dos No matter what emotions you may have regarding the end of your marriage, the legal aspects of extricating yourself from a partnership may have you feeling a bit confused or frazzled. If you can take a step back from the emotional side of your divorce and, instead, address each part of the process in as calm and logical a manner as possible, you may find it easier to concentrate on practical matters. With the knowledgeable guidance of your attorney, you can if you concentrate on key issues, such as: Separating your finances Saving and budgeting for your new expenses, including the divorce Obtaining necessary documentation Securing your own health insurance and updating other insurance policies Determining child custody Severing financial ties with your ex may be one of the most complicated steps, but it's important to set up your own bank account and credit cards as soon as possible. While looking at finances, you'll also want to begin saving for the [...]

admin2022-11-23T17:36:21+00:00Categories: Blog, Divorce|Tags: Divorce|

How to be financially prepared for your post-divorce life

On behalf of Morna Challoner of Challoner Law posted in Divorce on Thursday, February 2, 2017. Are you one of the California spouses who gave your marriage one last chance over the holidays? Many people file for divorce in January, while others who prefer to plan things before taking action may use the first month of the year to get everything in place before filing. Research data indicates that the peak for divorce filings occurs around March. The approach you take with your divorce will determine many matters, including whether you and your spouse will separate your finances according to a court order or before the final divorce decree according to agreements reached in negotiation. Decisions made at this time may affect your post-divorce financial stability, but because you do not need to do this alone, an experienced California divorce attorney can guide you through each step you need to take in the divorce process. If you left the separation of joint finances for the court to determine, be mindful that there are deadlines to meet to avoid landing back in court because of noncompliance. Your attorney can help you set up a checklist to avoid missing any deadlines. Steps to take when dividing property Property division can be a stressful matter during a divorce proceeding. Soon to be ex spouses can work together through negotiation, often the mediation process, to divide assets and finances. Navigating the unraveling of your finances through negotiation will require you to take the following steps: Update powers of attorney -- Do you want the person who will soon be your ex to make financial and medical decisions on your behalf if you are involved in an accident that leaves you incapacitated? Probably not, so the time to update health directives and financial powers of attorney is immediately after [...]

admin2020-03-02T22:47:12+00:00Categories: Blog, Divorce|Tags: Divorce|

Spring cleaning: Is it time to sweep out your spouse?

On behalf of Morna Challoner of Challoner Law posted in Divorce on Tuesday, March 14, 2017. As spring quickly approaches, you may consider making changes in your life as the spring cleaning urges strike. For many, this time of year does not simply mean getting rid of old clothes or giving the house a sparkling shine. Divorce may present itself as a major life change you may find yourself considering during this time of year. If you do find yourself looking into filing for divorce in March, your timing coincides with that of many other individuals who choose this time of year to make such a significant decision. In fact, early spring sees one of the highest spikes in filings throughout the year with August making up the other peak time. Holiday effects Many individuals often do not wish to file for divorce during the winter because many holidays fall into that time. You and others likely want to attempt one last family holiday season before taking the steps toward ending your marriage. Some parties may even think that if they can get through the holidays with little to no conflict, they may have a chance to save their relationships. However, this hope does not come to fruition for many individuals. Finances Because the holidays often typically involve a blow to financial aspects of your life due to gift buying and other expenses, filing for divorce right after the holidays may not end up as the best timing for you. Though the beginning of the year may have marked a turning point for you as far as making the decision to divorce, you may also have decided to give yourself some time to get your financial affairs in order before filing your divorce petition. As a result, March often comes as the [...]

admin2020-03-02T22:46:13+00:00Categories: Blog, Divorce|Tags: Divorce|