Archive for the ‘Division of Property’ Category

Prenuptial Agreements for Second and Third Marriages

April 24th, 2015 at 6:04 pm

prenuptial agreement, prenup, Illinois family law attorneyWhether you are entering your first marriage or your fifth, it is important to protect your assets by signing a prenuptial agreement. A prenuptial agreement is a legal document that details your plans for your assets and support in the event of a death or a divorce. In Illinois, they are governed by the Illinois Uniform Premarital Agreement Act.

Prenuptial agreements are especially important for individuals entering second and subsequent marriages because they are entering into a new agreement after being previously married and divorce. In essence, a marriage is a contract and when signing a new marriage contract, one must consider the terms he or she is bound to by his or her previous divorce contract.

Without a prenuptial agreement, your new spouse may be automatically entitled to your assets. Likewise, you may be entitled to his or hers. Prenuptial agreements are recommended for any individual who is planning to enter a marriage, but especially for business owners and individuals who have significant assets. Although it can seem unromantic to ask your partner to sign a prenuptial agreement, it is a realistic, responsible way to ensure that you retain your assets in a divorce or your children from a prior relationship still receive an inheritance after you pass away. It also allows you to have a full and frank discussion with your fiancée about your priorities and finances prior to entering into the marriage

What May Be Included in a Prenuptial Agreement?

  • Designations about who may receive funds from your assets, such as your stocks, bonds, and financial accounts;
  • Money and property allocations to your children from a previous marriage or former spouse;
  • The beneficiaries of your retirement plan. If your current spouse opts to waive this right, you may instead name a former spouse or your child the beneficiary of your retirement plan after your death;
  • The amount of spousal support, if any, a spouse will receive in the event of a divorce;and
  • Each spouse’s responsibility to your jointly-accumulated or individually-held debts.

For a prenuptial agreement to be valid, both parties must fully disclose all of their assets and debts. If either party is later found to have withheld information or lied about his or her financial circumstances at the time the prenuptial agreement was signed, the agreement may be invalidated.

Terms that can not be legally enforced may not be included in a prenuptial agreement. These include lifestyle choices like the number of children a couple has, where they live, and how they spend their time. Only tangible issues, such as those regarding a couple’s finances and assets, may be written into a prenuptial agreement.

Divorce Attorneys in the Chicago Area

If you are considering getting married for the second, third, or subsequent time, contact Anderson & Associates, P.C. to discuss the importance of signing a prenuptial agreement. The skilled Chicago divorce attorneys at our firm understand the unique financial considerations that individuals entering second and subsequent marriages face. Do not get married again without a prenuptial agreement. Contact us today to set up your initial legal consultation in one of our firm’s five convenient locations: Schaumburg, Orland Park, Northbrook, Wheaton, and downtown Chicago.

Can a Business’ Retained Earnings Be Considered Marital Property?

April 23rd, 2015 at 2:54 pm

retained earnings, division of property, Chicago divorce attorneysIn short, yes. When a couple builds a business together during their marriage, both partners have the right to seek a portion of the business’ value during their divorce.

Retained earnings are the profits that a company makes which are not distributed back to its shareholders. They are the profits that are held onto in a reserve and used for specific goals, such as paying off company debts, or reinvested into the business.

Shares in a company can become a contentious topic among divorcing couples because of the prospect of retained earnings. Retained earnings contribute to a company’s overall value. Shareholders have an interest in these earnings and a say in how they are used. If the court determines that an individual’s shares in a company are marital property, their value must be divided among the spouses. If one’s shares are nonmarital property, the court must determine the spouses’ contribution to the company to determine a fair distribution of their value.

Illinois is an equitable distribution state, which means that property is not necessarily divided exactly 50/50 between divorcing parties. Instead, the division of a couple’s property is done according to a variety of factors, including each partner’s needs and personal resources.

Marital Property vs. Non-Marital Property

Generally, all property acquired during a couple’s marriage is presumed to be marital property. This includes the couple’s home, any joint bank accounts, and any businesses that the couple starts together. A business that one partner started before the marriage, but considerably expanded during the marriage with marital money, credit, or labor, may be also considered to be marital property.

When determining whether a company’s retained earnings may be considered to be marital property during a divorce, the following questions must be asked:

  • Are the retained earnings calculated as part of the company’s total value?
  • Are the retained earnings being used for corporate business?
  • How much control does the spouse involved in the business have to pay out the retained earnings as dividends to him or herself?

Whether other individuals are part owners or shareholders in the company and what the couple chooses to do with the business upon their divorce can also determine whether its retained earnings may be divided among the spouses. Some couples choose to sell their businesses and split the profit while others opt to continue them, either jointly or with one spouse buying out the other’s share of the company.

Divorce Attorneys in the Chicago Area

Anderson & Associates, P.C. is proud to serve clients throughout the Chicago area in our five accessible office locations: downtown Chicago, Orland Park, Northbrook, Schaumburg, and Wheaton. To discuss your unique circumstances, call 312-345-9999 to speak with one of the experienced Chicago divorce attorneys at our firm.

Deciding Which Spouse Keeps the Family Home in a Divorce

April 10th, 2015 at 5:35 pm

family home, division of property, Illinois divorce attorneyDivorces are often fraught with uncertainty. Will I have to pay alimony? Who will get custody of the kids? Who gets to keep the house? During this difficult process, it is crucial that you keep yourself grounded and educated about how divorces work. Multiple factors play into which spouse keeps the family house after a divorce, if either spouse keeps it at all. In some cases, the couple is required to sell the house and split the proceeds.

If you want to keep your family home following your divorce, talk to your spouse about your desire and why it is important to you. If you choose to divorce through mediation or collaborative law, you will need to work with your spouse to develop a settlement that achieves both of your goals. After discussing your intention to keep the house with your spouse, the next step is to speak with an attorney about your rights, legal options, and how your case’s unique circumstances may affect your opportunity to keep your house.

The Family Home as Marital Property

The most important factor used to determine a house’s position and rightful ownership during a couple’s property division process is whether or not the house is considered to be marital property. Generally, marital property is any property that was purchased or significantly developed during the marriage. If you and your spouse purchased the home together after marrying, your home is marital property. Likewise, if either partner owned it prior to the marriage but the spouse made mortgage payments or significantly contributed to the home’s value through improvement projects after marrying, it may be considered to be marital property.

Under the Illinois Marriage and Dissolution of Marriage Act, Illinois is an equitable distribution state, which means that marital property is not necessarily split 50/50 during a divorce. Rather, it is divided between the spouses according to each partner’s contribution to the property during the marriage and their needs following the divorce.

Factors Considered When Determining Which Spouse Keeps the House

One of the most prominent factors considered when the court must determine which spouse keeps the family home is which spouse has primary custody of the couple’s children. If the court determines that it is in the children’s best interest to remain in the home and, by extension, their community and school district, the court may award the family home to the parent with whom the children will live most or all of the time. Sometimes, this award is temporary and the couple is required to sell the house once the youngest child turns 18.

Even if a spouse is awarded the home, that spouse may be required to buy out his or her former partner’s interest in the home. In some cases, the higher-earning spouse may be required to continue to pay for the home’s insurance or mortgage as part of a support arrangement. Either of these scenarios may be a possibility for you, depending on your current economic circumstances and your divorce’s details.

Chicago Divorce Attorneys

Call 312-345-9999 to schedule your free legal consultation with the skilled Chicago divorce attorneys at Anderson & Associates, P.C. to learn more about how the court may determine who keeps the family home in your divorce. We proudly serve our clients in five convenient locations: Wheaton, Orland Park, Northbrook, Schaumburg, and downtown Chicago.

Pursuing a Dissipation Claim Against Your Spouse

February 25th, 2015 at 9:42 am

dissipation claim, divorce lawyer in IllinoisThe division of marital property during a divorce proceeding is often contentious, particularly if the parties are disputing who gets which assets. Additional complications arise if one or both parties take steps to deplete those assets after the marriage has broken down.

When a couple is on the brink of divorce, one or both spouses might be tempted to spend marital assets to prevent the other from getting those assets in a divorce. This is called dissipation of marital property. Illinois law defines dissipation as a spouse’s use of marital or nonmarital property for his or her sole benefit for a purpose unrelated to the marriage after the marriage has begun to undergo an irretrievable breakdown.

Examples of dissipation include:

  • Buying gifts for a boyfriend or girlfriend;
  • Going on vacation with a boyfriend or girlfriend;
  • Excessive spending on gambling or lottery tickets;
  • Excessive spending on alcohol or other controlled substances;
  • Allowing the marital home or other real estate to fall into foreclosure; and
  • Failure to maintain marital property.

Claim Requirements

A spouse who wants to file a dissipation claim must do so 60 days before trial begins or 30 days after discovery closes, whichever date comes later. The spouse’s notice of intent must identify when the marriage underwent the irretrievable breakdown, the dissipated property, and when the dissipation occurred. If the party does not file a notice of intent within this timeframe, then any dissipation claims are waived.

Dissipation claims will not be successful if the spending was consistent with the lifestyle the couple established during the marriage. For example, if the alleged dissipater took a trip with the children during the divorce proceeding, and it is determined that the spouse took similar trips during the marriage then the claim is baseless. Furthermore, dissipation cannot be alleged if it occurred more than five years before the divorce petition was filed or three years after the party alleging dissipation knew or should have known about the dissipation.

Once a proper notice of intent to claim dissipation is file, the dissipating party has the burden to prove by clear and convincing evidence that the alleged dissipation did not occur. If the court determines that a dissipation claim is valid, it may compensate the wronged spouse. Typically this is done by offsetting the dissipated assets against the property awarded to the wasteful spouse in the judgment for dissolution of marriage.

Contact one of our Chicago divorce attorneys today if you suspect that your spouse is guilty of dissipation, or if your spouse files a dissipation claim against you. The timing and specifics of dissipation claims matter, and we will ensure that such claims are effectively pursued or defended. Anderson & Associates, P.C. has offices in Schaumburg, Wheaton, Northbrook, Orland Park and downtown Chicago.