Friday, April 12, 2013

DIVORCE: Money - What You Should Know


A major concern to parties involved in a divorce is money. How are marital assets such as property, savings and investment accounts divided and allocated? What costs are incurred in the course of gettting divorced? What about alimony and child support? How do these questions get answered?
If you are represented by Flaherty Legal Group in your divorce, you will be asked to provide a financial history of your marriage. This information will be needed by your attorney so that he or she knows the appropriate facts necessary to represent you.  The facts you provide will be used by the court to base its orders for the awarding of property and, if requested, alimony and support. The information requested will include:
- The present amount and sources of your income and that of your spouse.
- A complete chronological history of how you and your spouse contributed to the acquisition, preservation, or appreciation in value of the assets listed on your financial affidavit (see below). This history should include:
            - The sources of all cash used to purchase all assets, including stocks, bonds and all real estate owned during the marriage.
            - The amounts and signatories of all mortgage(s).
            - Whether loans were secured from family or friends; and
            - How investments and other types of assets were acquired. Include also a description of the assets, if any, that you or your spouse had on the date of your marriage. 
- You will be asked to describe:
            - The opportunity that you and your spouse each will have to acquire property or other assets in the future.
            - The lifestyle of you and your spouse during your marriage, concentrating in particular on the several years prior to the filing of the action for a dissolution of your marriage.  You will be asked to indicate the type of furnishings in your home, the frequency and type of vacations you took, meals out and other types of entertainment, country clubs joined, and so on.
            - The amount each spouse earned during the past five years.  This will include any and all benefits, including pension, bonuses, health and life insurance, stock options, automobile and/or travel provided by employers, credit union, and so on.
            - Who managed the finances and how any debt was incurred.
            - If you have any children, you will be asked to describe any special needs they have, including educational, medical, and so on.  You will describe your child-care if both spouses are working and your opinion of whether it is desirable for the custodial parent to be employed. 

FINANCIAL AFFIDAVIT

At the time of the final hearing, and at any other time in which there is a court hearing regarding orders, the parties must submit to the court financial statements sworn to and signed under oath.
At the beginning of your case, we give you a financial affidavit form and ask you to complete it.  We will also ask you to supply us with any pay stubs, copies of income tax returns, and any other financial documentation you may have.  We will then go over your figures with you so that we may have an accurate financial affidavit in your file.  Whenever we are to go to court on financial matters, we will contact you to update your financial affidavit.
Your spouse's attorney will have the opportunity to cross‑examine you about your financial affidavit.  He may subpoena your employment, banking and other financial records and compare this information with what you have stated on the affidavit.
Note that the line immediately above your signature on the financial affidavit states:  "I hereby certify that the foregoing statement is accurate to the best of my knowledge and that I can, if requested submit documentation for all assets, liabilities, and expenses listed above."

ALIMONY, CHILD SUPPORT, UNALLOCATED FAMILY SUPPORT, AND POST MAJORITY SUPPORT FOR CHILDREN

The court has the power to order one spouse to make payments to the other.  Alimony is paid to maintain the other spouse and can be paid in one lump sum or periodically.  Child support is paid periodically to the spouse who has custody of the children to maintain the children. 
The court also has the authority to order Post Majority Support for children after they have reached the age of majority under Connecticut General Statutes 46b-56c.
There are important federal income tax considerations involved in regard to these payments.  The spouse making alimony or unallocated alimony and support payments may deduct these from taxable income, while the recipient of alimony or unallocated alimony and support must declare these payments as income. Child support is not deductible by the payor nor taxable to the recipient.

FEES FOR LEGAL SERVICES

In representing you, Flaherty Legal Group offers you our skill and our time.  After entering into a representation agreement with our firm, much of what we do for you is not done in your presence and you have a right to know how our fees are determined. All legal services are charged at an hourly rate, including research, court appearances, phone conferences, office conferences, court appearances and the like.  Because it is impossible to know in advance how much time will be required for the resolution of your situation, we cannot charge a fixed fee.  To some degree you will be able to affect the legal fee charged because the complexities of the issues involved in your case together with your ability to resolve issues with your spouse will directly impact the ultimate total fee. You should note also that time spent on the telephone is billed at our hourly rate.
Our office requires that you pay a retainer, which is a fee paid in advance and credited toward legal services rendered. Should the final fee be less than the retainer, we return the difference to you. If the retainer does not cover the full fee, you will be billed for the difference. Bills are sent monthly and you are asked to keep current on these monthly bills. Separate costs expended by our office on your behalf, such as filing fees and service fees, will be billed to you. Sizeable fees will be discussed with you before being incurred and you should feel free to ask about your expenses at any time. This is further explained in the Representation Agreement you receive during the initial consultation. Monthly statements will be sent to you so that you are aware of the status of your account. 

Thank you for reading this installment of our informational blog series about divorce. In addition to this article about the financial aspects of divorce, other sections include: Basics, “Parenting, and The Process.

Attorney James T. Flaherty practices Divorce and Family Law with Pamela Magnano and Sandi Girolamo at Flaherty Legal Group in West Hartford, CT.
Attorney James Flaherty

Attorney James T. Flaherty practices Divorce and Family Law with Attorney Pamela M. Magnano and 

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