233 W. Wilson Street, Batavia, IL, 60510

Preserving Your Retirement Benefits During Your DivorceDivorce has a way of affecting every aspect of your life – including your retirement plans. Getting a divorce can deplete your retirement savings, disrupt your scheduled contributions, and throw off your planned retirement age. Those who are most affected are people going through a grey divorce, which is when people age 50 and older divorce after several years of marriage. A person in their 50s has less time to adjust their plans before they retire. No matter your age, divorce does not have to decimate your retirement plan if you are prepared during your negotiations:

  1. Prioritize Retirement Benefits: The value of your retirement account is marital property that you include in the division of assets. In order to keep valuable property, such as your marital home, you could agree to give up a portion of your retirement benefits or forgo your claim to your spouse’s benefits. Making this deal may be short-sighted because you are depleting your retirement plan and paying for maintenance and property taxes on the home. It may make more sense to downsize your home and preserve your retirement benefits.
  2. Review Your Budget: Your individual expenses can increase after divorce because you no longer have two incomes to pay for everything. Some divorcees are also responsible for child support or spousal maintenance payments. One option to free up more income for immediate expenses is to decrease your regular contributions to your retirement plan. You should take a close look at your budget to determine how much money you need – including for your retirement – and conduct your divorce negotiations with that target amount in mind.
  3. Claim Your Share: Some people have not put much effort into their own retirement plans because they intend to live off of their spouse’s retirement benefits. You are still entitled to a share of your spouse’s retirement after your divorce, especially if you were married for a long time. You can receive Social Security benefits valued at half of your spouse’s benefits, as long as the benefits you would receive on your own are less than that amount. You can file a qualified domestic relations order (QDRO) to receive a portion of your spouse’s retirement plan. Payment can be delayed until you have reached retirement age.

Contact a Kane County Divorce Lawyer

Your retirement benefits may be one of the most important properties that you decide on during your divorce. A Batavia, Illinois, divorce attorney at Van Larson Law, P.C., understands that it is vital to include your retirement plans as part of your divorce. Schedule a free consultation by calling 630-879-9090.

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How to Know Whether You Could Benefit from a Prenuptial AgreementNobody who is about to get married wants to think about the possibility that they may one day get divorced. You create a prenuptial agreement with that scenario in mind, which makes asking for a prenup an awkward conversation to have with your fiance. For some people, it is a worthwhile conversation to have given their individual circumstances. The agreement can decide how you will divide your marital properties and pay spousal maintenance at a time when it is easier to negotiate with each other than it would be during a divorce. Creating a prenuptial agreement would be particularly helpful if any of the following applies to you:

  1. There Is an Income Gap Between You and Your Partner: When one spouse is the breadwinner in a relationship, the other spouse becomes financially dependent upon the marriage. The solution in the event of a divorce is spousal maintenance paid to the lower-income spouse, but the higher-income spouse is likely to try to minimize those payments. By including spousal maintenance in the prenuptial agreement, the lower-income spouse has more certainty about the amount of financial support they would receive after a divorce.
  2. You Have Valuable Premarital Assets: It may not be worth the effort to create a prenuptial agreement if you and your spouse are entering your marriage with few assets. If you do divorce in the future, your financial situation may have changed enough that the property portion of the agreement would be obsolete. However, some people enter a marriage already owning valuable properties, such as real estate or a business. Though premarital properties are normally not divided in a divorce, it is easy for these valuable assets to become marital properties by comingling them with your marital finances. A prenuptial agreement can state that your valuable premarital assets would belong to you after your divorce.
  3. You Plan to Have Children: Prenuptial agreements are not allowed to decide issues such as child support or the allocation of parental responsibilities. However, raising your children may require one of you to take a step back in your career, whether it is leaving your job or passing up on opportunities for career advancement. As a result, your income may be lower than your spouse’s income, making spousal maintenance more important during a divorce.

Contact a Kane County Divorce Attorney

You cannot rush the creation of a prenuptial agreement. Signing the document without considering the consequences could put you at a disadvantage if you divorced. If you are considering a prenuptial agreement, you need to immediately contact a Batavia, Illinois, divorce attorney at Van Larson Law, P.C. To schedule a consultation today, call 630-879-9090.

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Three Changes to Illinois’ Spousal Maintenance LawThe beginning of 2019 saw an important change for couples looking to include spousal maintenance in their divorce agreements. A federal tax reform law from 2017 eliminated the popular alimony tax deduction. Spousal maintenance payors can no longer claim a tax deduction on their payments for any divorce agreement created starting in 2019. In turn, maintenance recipients are not required to include the payments in their taxable income. The alimony deduction was an incentive for payors to agree to higher maintenance payments, and divorce professionals feared that its elimination would make maintenance negotiations more difficult. States had more than a year to prepare for the elimination of the alimony deduction, and Illinois responded in 2018 with a revision to its spousal maintenance law.

Net Income

There were three major changes to Illinois’ spousal maintenance law. The first was that the formula for determining payments uses net income instead of gross income. Your net income is the money you receive in a paycheck after deductions for taxes and benefits plans. Illinois believes this switch is better at accounting for the tax burden of maintenance payers.

Payment Formula

The next change was to the payment formula:

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How Important Is Child Preference When Creating a Parenting Plan?During a divorce, a court rules on the allocation of parental responsibilities by considering what is in the best interest of the child. Listening to the child’s preferences is part of understanding their best interest, but courts will not give a child’s preference the same weight in every case. A parenting plan is an important part of creating a structured living environment for children after their parents have separated. Though the parents and the court want the child to be happy with the arrangement, there are times when adults have a better understanding of what is best for the children.

How Child Preference Is Weighed

Children of divorce may have a preference about which parent they will live with for a majority of the time. However, the issue of child preference does not come up in many parenting cases. Some children are uncomfortable choosing sides or admitting that they have a preference. When they do express a preference, the court may give it little or no credence if:

  • The child is not mature enough to explain why they are choosing one parent
  • The preference is clearly not in the child’s best interest
  • One of the parents appears to be manipulating the child’s opinion

Rather than have the child testify in front of a judge, the court may assign a licensed professional to talk with the child and discern their preference without parental interference.

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The Differences Between the Property Title and Mortgage with Your Marital HomeExcept in rare circumstances, only one of you will continue to own your marital home after your divorce. The most contentious issue surrounding your marital home will be who will keep it or whether you should sell it and divide the proceeds. If one of you is keeping your house, it is important to complete the agreement by legally transferring ownership and financial responsibility to one person. As the person keeping the home, you do not want your former spouse to have ownership rights over the property. As the person who is giving up the home, you do not want to be liable for mortgage payments on a house that you no longer own.

Property Title

The property title for your house is your ownership interest in the house, which can be full or partial. When you co-own a home with your spouse, both of your names are on the title to show that you each have partial ownership of the house. If your spouse agrees to give you full ownership of your marital home, you will assume your spouse’s ownership interest in the title. A deed is a legal document that transfers a property title to a new owner. Quitclaim deeds are the most common deeds used during Illinois divorce because:

  • It is a quick and relatively simple process; and
  • The recipient knows that the grantor owns the property and has the right to transfer it.

If you complete the deed while you are still married, you should be able to avoid a transfer tax because it is a gift between spouses.

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