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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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IL divorce lawyerAs part of your Illinois divorce process, you and your spouse will be asked to submit a financial affidavit that lists your assets and income. This financial data is vital to obtaining a fair divorce settlement. Asset division, child support, and spousal maintenance are all contingent on divorcing spouses’ financial circumstances. If a spouse omits income sources, underreports business revenue, hides assets, or otherwise falsifies data on his or her financial affidavit, decisions about these divorce issues will be based on inaccurate information. Furthermore, lying about finances during divorce is unlawful. A process called forensic accounting is often the best way to uncover the truth about a deceitful spouse’s finances during divorce.

What Do Forensic Accountants Do?

Forensic accounting refers to an investigation into a spouse’s property, income, debts, and expenses. The more complex a spouse’s financial portfolio, the more in-depth this investigation will need to be. A forensic accountant is a financial professional who has specialized auditing, accounting, and investigative skills. He or she will work closely with your divorce attorney to thoroughly examine your spouse’s finances and discover evidence of deceit. Tax returns, bank statements, credit card statements, business contracts, invoices, mortgage applications, and other documents can all provide clues about hidden assets.

Methods for Hiding Assets During an Illinois Divorce

There are many different ways that a spouse may lie about finances in order to manipulate the divorce settlement or judgment. Financial deception is often used in an attempt to pay less in child support or spousal support or keep the other spouse from receiving the property division settlement he or she deserves. A deceptive spouse may hide assets by not reporting the assets or transferring assets to an unknown bank account. Spouses may also transfer assets to friends, family members, or coworkers. The Internal Revenue Service (IRS) is also sometimes used as a hiding place for assets. By “accidentally” overpaying the IRS, the spouse essentially loans the IRS money that is then returned to him after the divorce is finalized. Spouses may also undervalue assets, report lower than actual business revenue, or exaggerate debts and expenses in an attempt to sway a divorce settlement in their favor.

Contact a Kane County Hidden Assets Lawyer

Whether your divorce case is resolved through lawyer-assisted negotiations or courtroom litigation, accurate and complete financial information from both parties is crucial. If you suspect that your spouse is hiding assets, underreporting income, or otherwise lying about his or her finances, you need a divorce attorney who can protect your rights and advocate on your behalf. Call Shaw Family Law, P.C. at 630-584-5550 today and schedule a consultation with a highly experienced St. Charles divorce attorney to learn how we can help you get the divorce settlement you deserve.

 

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IL divorce lawyerTypically, the greater number of high-value and complex assets a married couple has, the more complicated property division is during divorce. Property division may be an especially difficult process if the spouses do not agree on how property should be divided or are not willing to be honest and forthcoming about property and debt. A spouse who is planning to divorce may attempt to conceal income or hide assets in order to prevent these assets from being factored into the divorce settlement. If you are considering divorce and you have reason to suspect that your spouse may be hiding assets or lying about finances, an experienced divorce attorney can help you uncover the truth so that you can obtain a fair divorce settlement.

One Spouse Handles The Majority of the Financial Transactions

In many marriages, one spouse handles the finances while the other spouse manages other responsibilities. Although this division of labor works well for many married couples, it can also leave one spouse completely out of the loop when it comes to money issues. If you have traditionally allowed your spouse to pay the bills, file tax returns, and make major financial decisions without your input, this can leave you at a major disadvantage during divorce. It may be a good idea to investigate financial documents like tax returns and look for clues that reveal potential financial deception. For example, you may find that your spouse owns property that you are not aware of through an itemized deduction involving property taxes.

Unusual Behavior and Other Red Flags

A spouse may lie about finances in order to gain an unfair property division arrangement or pay less than his or her fair share of child support or spousal maintenance. He or she may overstate debts and expenses, hide or undervalue property, and report lower than actual income. However, falsifying financial data during divorce can be hard to do without leaving at least some clues behind. Red flags that may hint at financial deception include:

  • Unusual bank activity such as frequent withdrawals or transfers
  • Missing account statements and other financial documents
  • Cash or property being gifted to friends and relatives
  • Defensive and secretive behavior regarding finances
  • Increased international travel
  • Changes to computer and smartphone passwords
  • Mail being rerouted to a different address

Contact a St. Charles Divorce Lawyer

Uncovering financial fraud during divorce can be especially difficult if a spouse has not been kept up-to-date about finances during the marriage or if a couple owns complex or high-value assets. If you have reason to believe that your spouse may attempt to gain an unfair advantage during divorce proceedings through financial deception, contact Shaw Family Law. Our knowledgeable Kane County divorce attorneys collaborate with experienced forensic accountants and other financial experts in order to help spouses obtain a divorce settlement that is based on the truth. Schedule a free, confidential consultation by calling us at 630-584-5550 today.

 

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IL divorce lawyerUnderstandably, divorce can be a very emotional process. Many people getting divorced struggle to make good financial decisions and not let their emotions dictate their behavior. Some of the most common divorce mistakes stem from short-sightedness and haste regarding finances. Fortunately, there are steps you can take to avoid adding superfluous expense to your divorce. Read on to learn about some of the ways that divorcing individuals inadvertently increase the cost of their divorce and how you can avoid these financial pitfalls.

Mediation is an Affordable Alternative to Court Intervention

Cooperating and negotiating with a soon-to-be-ex-spouse can be one of the hardest parts of the divorce process. However, working with your spouse to come to an agreement on divorce issues is much less expensive than courtroom litigation. If you find it difficult to talk to your spouse about property and debt division, child custody, spousal support, or other divorce-related concerns, mediation may be a useful option. During mediation, a specially-qualified mediator acts as a neutral third-party during negotiations. The mediator helps the divorcing couple reach agreements about divorce issues so that the couple does not need to take the matters to court.

Unhealthy and Expensive Coping Mechanisms Can Cost

Ending a marriage can be an incredibly stressful undertaking. Because of this, many people getting divorced find themselves indulging in comforts like food, alcohol, or fun activities. Experts say that some self-pampering can be beneficial during divorce but overindulging can create serious problems. One recent study found that the risk of developing alcoholism increased for both men and women following a divorce. Using drugs, alcohol, gambling, or excessive retail therapy to avoid negative emotions during divorce can quickly escalate and lead to financial disaster in the future.

Carefully Consider What to Do with Your House

If you are like most people, you have a sentimental attachment to the place you call home. During divorce, the last thing you may want is to be uprooted and forced to move into a new house or apartment. However, it is not always in your best interest to keep the house when you get divorced. Making a monthly mortgage payment and maintaining a home alone is usually much harder than it is with a spouse. For other divorcing spouses, it makes more financial sense for them to keep the home than to sell it. Make sure to consider all of the possible options when it comes to the marital home and consider the long-term consequences of selling or keeping the house.

Contact a Kane County Divorce Lawyer

If you are getting divorced, contact a St. Charles divorce attorney from Shaw Family Law, P.C. to get the help you need. Schedule a free, confidential consultation by calling our office today at 630-584-5550.

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IL divorce lawyerThe two areas that cause the most deliberation in divorce cases is child custody arrangements and the division of assets. Going through your finances and properties can cause ugly sides to come out of divorcing couples. Some will claim that certain assets are theirs alone while others will complain that they are not receiving enough in the division process. In Illinois, all marital assets are eligible for equal distribution between both spouses. This can seem unfair to the spouse that is the primary breadwinner of the house or can cause panic for the spouse that relies on these assets to get by after the divorce. These mix of emotions can cause spouses to make illegal attempts to conceal assets.

Common Hiding Places

Hiding assets is not typically done by putting wads of cash in the cookie jar. There are various common tactics used that can attempt to avoid a paper trail of evidence:

  • Watch Your Bank Accounts: The first place to start your search is your personal and shared bank accounts. Monitoring purchases and monetary movement may give initial proof to your suspicion.
  • Unreported Income: If your former spouse is involved in any form of cash enterprise, they may be pocketing funds without notifying the government for tax purposes. While this can be difficult to prove without professional help, comparing your spending habits to your spouse’s and looking back on your financial situation throughout your marriage can be a start.
  • Debt Payments: Some people will spontaneously owe their friends “debts” then have the friend return the money after the divorce is finalized. This will allow them to set money aside and avoid dividing it with you.
  • Shady Business: If your spouse has their own business, they could be using this to their advantage. Sometimes they will wait to charge clients for services until after the divorce. In other cases, they will pay an “employee” who does not actually exist and file the money into an account that they can access after the divorce.

Seek Professional Help in St. Charles, IL

Locating hidden assets can be extremely difficult for someone who does not have experience doing so. While these may be common places to hide money, there are many others that should be looked at to ensure that you receive your equal share of finances. At Shaw Family Law, we work with an experienced forensic accountant and other financial experts to analyze all possible areas of hidden assets. If you suspect that your spouse could be hiding assets from you, contact our Kane County divorce attorneys at 630-584-5550 for a free consultation.

 

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Posted on in Property Division

Il divorce lawyerFamily businesses can be difficult to successfully maintain. Some believe that mixing family and business is a recipe for disaster; however, family businesses often become the pride and joy of the owners. Because the businesses are often built from the ground up, it is much more difficult to let them go. This is often a problem that divorced couples who own a family business face. Not only do they have a personal connection to their workplace, but those involved in family businesses often have often invested a lot of time and money into their business. Continue reading to learn about the various options divorced couples have when deciding what to do with their family-owned business.

Your Options

There are a variety of options available to those trying to figure out what to do with the family business while going through a divorce. Every couple’s divorce is different, some being a mutual decision while others happen by surprise. Regardless of the situation at hand, sometimes one has to separate emotions from business no matter how much time and energy they have put into their job.

  1. Continue Owning the Business Together: Though this option does not work for everyone, some choose to continue running their family business in a similar manner. This is more common in couples that are mutually ending their marriage amicably. While you may decide to work different schedules and keep business meetings to a minimum, keeping the family business within the family is an option for some.

  2. Buy Out Your Ex-Spouse: For most couples, working together post-divorce is unhealthy and unreasonable. An option for those who no longer want to be tied together personally or professionally is to have one spouse buy out the other. This will require legal assistance on both sides but is often a relatively quick and easy solution.

  3. Sell the Business: Family-owned businesses are more than just a business to those involved. Memories become tied to the building and the business as a whole, making it extremely difficult to continue working in the environment. Many decide to sell their family businesses and have a fresh start. This can be due to the personal connection or financial burden that the business has once a marriage comes to an end.

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Illinois divorce attorney, Illinois family lawyerProtecting your finances as you prepare for the divorce process is perhaps one of the most important tasks you can take on before your marriage officially ends. Planning is everything, as divorce can easily wreak havoc on your financial standing if you are not careful. Protecting your assets and monetary funds is critical if you want to maintain the lifestyle you are currently accustomed to and ensure your financial future is secure.

Constructing a Game Plan

As a divorcing spouse, you are already facing an emotional toll; the last thing you want is to tack on additional stress due to financial trouble, especially when some of that trouble can be avoided if addressed early on. Here are some important steps you can take to safeguard your finances amidst your impending divorce:

Take inventory - As overwhelming as it might be, taking financial inventory is a must. Sit down and create a list of every account and asset you share with your soon-to-be ex-spouse. You will need to take stock of joint accounts and pay special attention to lines of credit, as well as wills, retirement accounts, and any pending purchases or joint business investments. Also take note of any life insurance policies you opened up while with your spouse. You may wish to modify the policy if you had them listed as a beneficiary. Once you have a clear, thorough list of all your debts, accounts, and belongings, it is time to sit down with your spouse and speak civilly about what you would both like to see happen with each respective item on the list.

Establish your own credit - Whether you are at the beginning of the initial separation process, have a hunch that your marriage is on the rocks, or are diving straight into divorce, it is never too soon to try and establish your own line of credit. If you are on the verge of separating, you are at an advantage; the sooner you establish your own credit, the better off you will be post-divorce. This goes for standard bank accounts, as well. The moment you see your marriage coming to an end, start shuffling away some cash of your own. The divorce process itself costs money, and you will need funds to get by on your own afterward. This is imperative, especially if you have never lived alone or will be on your own for the first time in years.

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b2ap3_thumbnail_asset-division.jpgRegardless of how much or how little you and your soon-to-be ex-spouse own, the division of assets in the divorce process can significantly impact your financial standing after your marriage is over. Whether you need to look out for your own well-being or you have additional family members to care for after the separation, money matters. What you and your spouse split and how you split it will be a defining factor in the overall quality of your long-term financial security.

Where Asset Division Can Get Tricky

Determining Value

Some couples make the mistake of believing that the most important factor in the division of assets is the flat dollar value. Whatever something is worth must determine its overall value and it should simply be divided evenly, right? This is not always the case. When it comes to most assets, their worth must be based on more than just their dollar value. For example, you must take into account factors such as an asset’s liquidity as well as how its sale will be affected by taxes. The long-term worth of a piece of property is just as important as its immediate worth.

Types of Property

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