Division of Assets in a Divorce: Why Consulting an Attorney is in Your Best Interests

Division of Assets in a Divorce: Why Consulting an Attorney is in Your Best Interests

When you divorce, state law requires you and your partner to divide the marital assets in a manner that is reasonable and acceptable to both parties.  In the best case, both parties will cooperate and be fair about the division of assets.  In the worst case, one or both parties may contest particular assets, claim an asset is separate property, or hide assets.

Whether you and your spouse have a contentious or amicable relationship, it’s often a smart idea to consult with a Family Law Attorney when you are dividing your assets. Your attorney can help you understand the difference between separate property and community property, mediate between both parties, or represent you in front of the other party’s family law attorney so your best interests are served.

Dividing the Marital Assets

The first step is for both parties to make a list of marital assets. Unless otherwise stated in a premarital agreement, marital assets are divided equitably. While not a complete list, some of the most common marital assets include:

  • Family home
  • Cars
  • Boat
  • Bank accounts
  • Vacation home or property
  • Investments
  • Securities such as stocks and bonds
  • Retirement Benefits
  • Valuables
  • Jewelry
  • Collectibles
  • Furniture Household Items

California is a Community Property State

In a community property state such as California, assets are generally split 50/50. However, in some cases, it may be in your best interest to negotiate a different settlement. Rather than think in terms of the present monetary value, you should consider short and long-term financial goals. An experienced Family Law Attorney can guide you to divide your assets in a way that protects you now and in the future.

Separate Property versus Marital Property

Generally speaking, separate property is not included in the division of assets. Separate property can include:

  • Property that was owned by either partner prior to the marriage
  • Inheritance acquired before or after the marriage
  • Third party personal gifts
  • Monies earned from a personal injury settlement

An exception to this case is if the separate property is co-mingled with your spouse. If this happens, an argument can be made that the separate property is now marital property and your spouse has rights to it.

Marital property is anything else that was purchased or acquired during the marriage. Marital property is generally divided equitably during the division of assets.

If you are unsure whether your property is separate or marital, consult a Family Law Lawyer.

Hiring a Forensic Accountant in a Divorce Case

If your spouse is not forthcoming with his or her assets, you may want to consider hiring a forensic accountant. A forensic accountant may investigate, acquire, and analyze information that can help you come up with a fair and just settlement. He or she can also represent you in court.

In Need of a Family Law Attorney in Walnut Creek?

Mendes Weed, LLP has experience in Family Law matters and can help you with your divorce proceedings. If you need assistance with your division of assets or want someone to represent you in front of your spouse or his or her attorney, please contact us.

Disclaimer: The tips and materials provided in this email are for informational purposes only, offered as public service. No information in this email should be considered legal advice or used as a substitute for legal advice. For legal advice, you should contact an attorney directly.

[et_social_follow icon_style=”slide” icon_shape=”rounded” icons_location=”top” col_number=”auto” counts=”true” counts_num=”0″ total=”true” outer_color=”dark” network_names=”true”]

SuperLawyers-RisingStars
Best of the East Bay Attorneys
Lisa Janine MendesReviewsout of 5 reviews
Walnut Creek Chanber of Commerce logo
Christina Weed - Taxation Law Specialist
lawyers of distinction badge 2020

Got a lot of assets? Here are 3 things to consider for a High Asset Divorce.

Got a lot of assets? Here are 3 things to consider for a High Asset Divorce.

Regardless of your opinions about divorce, the common consensus is that a divorce is expensive.  The cost of a divorce can be increased for a community estate which has high income earner(s), and/or significant assets.

At times in high asset cases, some or much of a spouse’s wealth was acquired before the marriage.  It is not uncommon for the disposition of these assets to be controlled by a premarital agreement, or pre-nup as it is commonly referred to.

However, in some cases, especially in long term marriages, the community fortune is just that, the community’s.  The division and disposition of these assets can be a complicated, confusing and arduous task.

Thoughts for any high asset case:

  1. Hire counsel

Litigants in most divorce cases can benefit from hiring their own attorney, but this is especially true in high asset cases.  High asset cases often bring more complicated family law issues.  For example, business entity holdings, stock options, multiple properties-domestic and abroad, significant retirement and other financial accounts.  A family law attorney can help you sort through these assets, and help you assess them for negotiation purposes.

It is not uncommon for one spouse to been in primary control of the finances.  This will not proscribe a non-earner spouse from the ability to hire counsel.  The law states that attorney’s fees may be paid with community property funds, or from marital property.  Under California Family Code Section 2030, the Court can award attorney’s fees when there is a disparity in income.  Thus, in cases where one spouse is the primary, or only, earner, he/she may be responsible for paying both parties’ attorney’s fees.

  1. Locate the Assets

Do you know where the bodies are buried?  Have you followed the belief that ignorance is bliss when it comes to your marital assets? Spouse’s income?  Consider the definition of an asset.  It is easy to remember the larger assets-bank accounts, homes, boats, cars, etc; however, many forget about artwork, guns, tools, jewelry, collectables, and other personal property.

Clients often find it beneficial to start a list.  Not only does this help you remember what you have, it will assist you when needing to prepare your required financial disclosures.

  1. That’s None of Your Business

It is understandable that many higher earners, and/or significant asset estates, and certainly those in the public eye, do not want their financial information, and family business in the public record for all to see.  The use of a private judge is a way to help privatize some of this exposure.  In addition, attorneys and litigants often request certain sensitive information be sealed within the Court file.

CNN has elaborated on some of the big mistakes one can make in cases like this, and Forbes has put together an article to help you get the most from a high asset divorce.  If you need assistance navigating your high asset divorce, or simply want to avoid some of the common mistakes clients make, Mendes Weed, LLP can assist you with your questions and concerns, as well as the process and procedures.

The tips and materials provided on this page are for informational purposes only, offered as public service. No information on this website should be considered legal advice or used as a substitute for legal advice. For legal advice, you should contact an attorney directly.

SuperLawyers-RisingStars
Best of the East Bay Attorneys
Lisa Janine MendesReviewsout of 5 reviews
Walnut Creek Chanber of Commerce logo
Christina Weed - Taxation Law Specialist
lawyers of distinction badge 2020

“Say WATT?!”  So you want to stay in the house…

“Say WATT?!” So you want to stay in the house…

The comment I often hear from many of my divorce clients is, “Well, I want to stay in the house.”  This is completely understandable. Your house is where your kids are comfortable. It is where you are comfortable. Relocation at this time of upheaval would be stressful. Moving is right up there with divorce for being one of the most stressful life events.

However, do you realize that staying in the house could also be stressful on your wallet?  A Watts Charge (or Watts Credit, they are interchangeable) refers to the obligation of one spouse to the other for the exclusive use of a community property asset following the date of separation.  This legal premise was established in 1985 by John and Carol Watts.  This is most commonly seen when one party remains in the now-former family residence.

This legal right is often seen in tandem with Epstein Credits.  In 1979, the Supreme Court heard from Elayne and Leon Epstein, who, among many things, argued the issue of reimbursements.

Under Epstein, a spouse has the right to reimbursement from the other spouse for one-half of his/her separate property money used to pay a community debt after the date of separation.

The mortgage on a community property house is a community property debt. However, if one spouse remains in the home after the date of separation, using their now-separate property income, to pay for the community property debt, they are entitled to reimbursement for one-half of that amount.  (One-half, not the whole enchilada. You are not allowed to reimburse yourself. Nice try.)

Further, under Watts, if one spouse is living in the house without the other spouse (exclusively using a community asset), then the spouse who has remained in the family home owes the community payment for the amount which is reasonable for the exclusive use of that asset.  Yes, you could owe what is essentially “rent” to the community.

If you are considering a divorce, or are currently in the middle of one, and have either decided to remain or vacate the family residence, you could be either liable for, or entitled to, some money you may not know about.  Contact the team at Mendes Weed to find out.

SuperLawyers-RisingStars
Best of the East Bay Attorneys
Lisa Janine MendesReviewsout of 5 reviews
Walnut Creek Chanber of Commerce logo
Christina Weed - Taxation Law Specialist
lawyers of distinction badge 2020