Posted on in Property Division

IL divorce lawyerMany Illinois couples sign a prenuptial agreement before the wedding, but far fewer people have heard of a postnuptial agreement. Postnuptial agreements are essentially the same thing as prenuptial agreements, but they are signed after a couple is already married.

Every couple’s situation is unique and an experienced Illinois postnuptial attorney is the best person to answer questions and draft a postnuptial agreement. Here are some of the most common reasons spouses in Illinois sign a postnuptial agreement, as well as the kind of issues postnuptial agreements can address.

Why Get a Postnuptial Agreement if We Are Already Married?

Couples may seek a prenuptial agreement for many reasons, but some of the most common include:

  • Wealth inequality - If one spouse owns substantially more wealth than the other, they may want to protect their assets in the event of a divorce. Postnuptial agreements can ensure that spouses retain individual ownership of their personal assets that may otherwise be included in the property division process.
  • Children from previous marriages - Spouses who were previously married and who still need to financially provide for their children often want to ensure their current marriage does not inadvertently jeopardize their children’s short- and long-term financial wellbeing. For example, because spouses typically inherit each other’s assets if one spouse dies, a postnuptial agreement can stipulate that a deceased spouse will leave their inheritance in part or in whole to their children. Likewise, a postnuptial agreement can stipulate that a portion of the parent spouse’s income will always be available for their children’s needs.
  • Business ownership - A spouse who owns a business can protect their exclusive ownership of the business with a postnuptial agreement. Assessing and dividing the value of a business is a complex and difficult part of many divorces, and a sound postnuptial agreement can prevent unnecessary conflict and hostility in the future.
  • Potential inheritance - Spouses who anticipate receiving a sizable inheritance may want to ensure that it remains their sole property in the event of a divorce. Although an inheritance is generally presumed to be the property of the inheriting spouse, certain behaviors like commingling can complicate ownership. A postnuptial agreement can simplify matters.

What Can a Postnuptial Agreement Include?

Many of the things couples choose to include in their postnuptial agreement are related to the above situations. Other possible provisions include:

  • Parameters for spousal support if the couple divorces
  • Division of debts, including student loans accumulated during the course of the marriage
  • What happens to shared assets if one spouse passes away
  • Which spouse will pay for certain expenses during the marriage
  • How much each spouse will contribute to joint savings or retirement accounts
  • Which spouse will be responsible for managing the couple’s finances

A postnuptial agreement cannot address issues related to child support and child custody. These can only be addressed during a divorce or separation with the approval of an Illinois court.

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IL divorce lawyerThe division of marital assets in an Illinois divorce is a stressful process under any circumstances, and it can be made worse by a spouse who recklessly or intentionally wastes assets, or uses them for self-serving purposes before the divorce is finalized. The legal term for this behavior is “dissipation,” and there are remedies available to a spouse who has been wronged by it. However, it is important to understand what actually qualifies as dissipation to make sure you have grounds to file a claim against your spouse.

Uncovering Signs of Asset Dissipation

Before you can go about claiming dissipation, you need to be aware that it is happening. In some cases, a spouse’s wasting of marital assets may be open and obvious, especially if they are doing it out of spite or a desire to hurt the other spouse. However, it is more common for a spouse to try to hide their dissipation. You may be able to find signs of dissipation on your own by carefully reviewing your joint bank accounts, credit cards, and other financial documents. You can also enlist the services of a forensic accountant to find signs that you may have missed.

What Qualifies as Dissipation in Illinois?

You may have questions and concerns about your spouse’s spending behavior in a variety of circumstances, but only certain kinds of behaviors qualify as dissipation from a legal standpoint. You can better determine whether your spouse is dissipating assets by asking yourself the following questions about their behavior:

  • Did you approve of your spouse’s use of the assets? If you knew of your spouse’s spending behavior and agreed to it at the time, it will be difficult to make a case for dissipation even if you later decide that the behavior was inappropriate. On the other hand, use of assets without your knowledge or consent may qualify as dissipation.
  • Did you benefit from your spouse’s use of the assets? Even if you did not know in advance of your spouse’s intention to use assets, it will be difficult to claim dissipation if you benefited from their behavior in some way, like using a car that they bought or going on a trip that they paid for. However, if your spouse used the assets for entirely selfish purposes, like gambling, paying for a solo trip, or buying gifts for an extramarital affair, a claim of dissipation may be more successful.
  • Did the behavior occur after your marriage had failed? Only behavior that took place after the start of an “irretrievable breakdown” in your marriage qualifies as dissipation. You may be able to demonstrate such a breakdown if you were already living apart if you were aware of your spouse’s affair, or one of you had already filed for divorce, for example.

Contact a Kane County Divorce Attorney

If you believe your spouse has dissipated marital assets, the St. Charles divorce lawyers at Shaw Family Law, P.C. can help you file a claim for reimbursement. With our help, you can better protect your interests throughout the division of marital property. Call us today for a free consultation at 630-584-5550.

 

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IL divorce lawyerWhen a couple gets married, their finances become intertwined. This includes not just the property they own, but also their obligations to repay certain debts. Just as a couple’s home is often their most valuable asset, the mortgage they took out to finance it is often their largest source of debt. In the event of a divorce, the home’s equity and the outstanding mortgage balance will both significantly impact the division of marital property.

As you decide how to handle all of your assets and debts in your divorce, you should give special consideration to your home mortgage. If you and your spouse are willing to work out an agreement, you may have several options to either reduce the debt or allocate it fairly.

Eliminating Mortgage Debt by Selling Your Home

Often, the simplest option for handling your home and the associated mortgage in your divorce is to sell the property. If the housing market is strong, you may be able to completely eliminate your mortgage debt by selling your house, perhaps with revenue left over to distribute fairly between you and your spouse. Of course, this means that neither of you will be able to continue living in the home, but this may be a good option if you are both looking for a fresh start.

Refinancing the Mortgage

If you or your spouse wants to continue living in your home after the divorce, the person who keeps the property will likely need to assume full responsibility for the mortgage and reimburse the other spouse for their share of the equity. Usually, refinancing the mortgage in one spouse’s name is the most effective way to do this, as long as that spouse has the credit, income, and assets to qualify for the loan on their own. Refinancing ensures that the other spouse is not still liable to creditors, and it may even result in a more favorable interest rate for the spouse who keeps the home.

Setting Up a Payment Agreement

A less conventional arrangement is one in which you and your spouse remain as joint owners of your home for some time after the divorce. This may be a good choice if, for example, you want to continue raising your children in the home they are accustomed to. However, you should be certain that you and your spouse can trust each other to maintain this arrangement, and it is a good idea to include provisions in your divorce agreement regarding how you will share mortgage payments and other expenses related to the home.

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IL family lawyerWhen two people get married they merge their financial lives in such a way that dividing assets and debts prove quite difficult during divorce. Property division during divorce is further complicated when the couple owns complex assets, has a particularly high income, or when a spouse refuses to be honest about his or her finances. The spouses’ financial situations will also have a dramatic impact on child support, spousal support, and other elements of the divorce. Forensic accounting may help divorcing spouses trace marital assets and debts, reveal hidden assets and income, determine how much money is available for support payments, and much more.

How a Forensic Accountant May Help During Divorce

Divorce lawyers often utilize the expertise of a forensic accountant when complicated financial circumstances or financial deception confound the divorce process. Forensic accounting is often used when a married couple owns a business or professional practice or other complex assets like stocks and stock options, retirement funds, cryptocurrency, or real estate.

Forensic accounting may also be used as an investigative tool. Divorcing spouses are expected to fully disclose accurate information about their income, business revenue, assets, expenses, and debts. In order to sway the outcome of the divorce in their favor, some divorcing spouses conceal assets or lie about finances. A forensic accountant may help your lawyer uncover hidden accounts, secret property transfers, and other sources of deception. Accurate information about finances is needed to make a determination about many different issues during divorce including asset and debt division, alimony, and child-related issues The only way to ensure you receive a fair divorce settlement or award is to base that settlement off of verifiably accurate financial data. Forensic accountants may assist in your divorce case by:

  • Investigating a spouse’s finances and looking for inconsistencies
  • Finding hidden assets, income, and revenue streams
  • Assigning a value to items with fluctuating or hard-to-determine values
  • Inventorying valuable personal property such as art, jewelry, and collectibles
  • Evaluating the long-term financial consequences of potential divorce settlements

Contact a St. Charles Divorce Lawyer

Financial issues during divorce are often complicated and contentious. If you are considering divorce and you or your spouse own a business or other complex assets, forensic accounting may be an advantageous tool. Forensic accounting may also be used to find hidden assets and reveal other forms of financial fraud during divorce. At Shaw Family Law, P.C., our accomplished Kane County family law attorneys know how to work with experts such as forensic accountants to ensure our clients receive the settlement they deserve. Call us at 630-584-5550 for a free consultation.

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IL divorce lawyerIf you are considering divorce, you may have considerable concerns about how the split will affect your finances. One issue that many divorcing couples have questions about is how retirement accounts are handled during divorce. Even if retirement is still several years away, it is important to ensure that you will have access to the funds you need when the time comes. Depending on the type of retirement account in question and the length of your marriage, it is possible that retirement funds will play a significant role in the division of marital assets during divorce.

Which Retirement Funds Are Considered Part of the Marital Estate?

Marital property includes assets that were acquired by either spouse during the marriage. Non-marital property includes assets that were acquired before the marriage. Retirement funds that accrued while you and your spouse were married are usually considered marital property while funds accumulated before the marriage are non-marital property. Therefore, it is possible that a portion of the retirement funds will be considered subject to division during divorce while another portion of the accounts are not subject to division. Accurately valuing and dividing pensions, IRAs, and 401(k)s, during divorce can be a complex task – especially if the retirement funds include stocks or other assets that may fluctuate in value. The tax consequences of retirement fund distribution is also a major factor to consider when deciding how to handle retirement accounts.

Designing Your Own Property Division Arrangement

A divorce lawyer experienced in property distribution concerns can help you negotiate a divorce settlement that minimizes the negative tax consequences associated with paying out a retirement account. Depending on your unique situation, it may be best to assign one spouse the retirement funds and assign the other spouse marital assets of an approximately equal value. This is referred to as the “immediate offset method.” In other cases, it makes sense to actually divide the retirement funds between the spouses. If you plan to divide retirement funds, you will likely need a Qualified Domestic Relations Order (QDRO). This is a court order that instructs the retirement plan administrator to implement the division. Retirement funds divided via a QDRO may be immediately distributed as a lump sum or the funds may be released to the spouses upon retirement. Fortunately, retirement funds withdrawn through a QDRO are not subject to the 10 percent early withdrawal penalty.

Contact a St. Charles Property Division Lawyer

For trustworthy legal advice regarding division of assets during divorce, contact Shaw Family Law, P.C. Call our office today at 630-584-5550 to schedule a free consultation with one of our skilled Kane County divorce attorneys.

 

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