Oakland Family Law Blog

Accuracy important when dividing retirement funds

Retirement funds can often be the largest single asset at stake in a divorce for couples in California who have decided to end their marriages. Because these accounts are so critical to the financial future and security of both parties, dealing with them can be one of the most contentious issues in divorce negotiations. Indeed, in a 2016 survey, 62 percent of divorce lawyers identified retirement accounts as one of the most difficult issues for their clients to address.

Each type of retirement account must be handled appropriately for the legal and financial rules that govern it, even when it is being distributed as part of a property division settlement in a divorce. If the distribution is not dealt with properly, each spouse could face significant financial losses in terms of taxes, fees and penalties, and the outcome of the distribution could also reflect an inequitable or unequal outcome.

Keeping assets separate in case of divorce

California couples who are getting married might not want to think about the possibility of divorce. However, taking steps for financial self-protection in case of divorce is really no different from any other safety precaution. Couples who are not yet married can specify in a prenuptial agreement what property and debts they want to keep separate if they divorce.

Before the wedding, couples might want to consider getting appraisals for assets such as businesses that can be difficult to valuate. If a couple is already married, they could create a postnuptial agreement that serves much the same purpose as a prenup.

Divorce and a place to live

Settling on a place to live during a divorce and afterwards can be a difficult decision for some California residents who are ending their marriage. The usual options include remaining in the current home, renting a home or purchasing a new place. There are multiple factors to consider before making a final decision about where to live.

The emotional attachment people have to their current home can make it difficult to imagine living elsewhere. One may feel even more inclined to remain in the home if there are minor children involved. Staying in the home can give parents and children a sense that one part of their lives is constant during a time when many other aspects are experiencing an upheaval.

How quasi-community property ownership affects divorces

As you may have learned if you filed for divorce, the community property laws of California (and a handful of other states) can seriously impact the final settlement you receive to start your new life unencumbered.

Those California residents who have valuable property and significant debts should learn all that they can about the community property laws of the state, which also affect the division of debts as well as property. It's also important that those who signed pre- and postnuptial agreements seek guidance before filing their petitions for divorce. This can help avoid common pitfalls that could deprive you of your rightful share of the property from your marriage.

Navigating shared parenting in child custody cases

When California parents of young children go through a divorce, the primary concern is often how to handle child custody. There are many commonly held perceptions about shared parenting and its effect on children that can undermine positive efforts to achieve a workable custody schedule. While decisions about custody are generally framed as being in the best interests of the child, the phrase can be vague and unclear.

Evidence indicates that children who experience the best outcomes are those who have a shared parenting schedule, in which both parents share child custody, including physical presence and legal decision-making. The strong research backing up shared parenting, however, has done little to reassure a number of skeptical parents. In some cases, people believe that children feel insecure or unstable when they move back and forth from one parent's home to another, and being with one parent only is a more stable environment. However, studies show that kids reap far stronger rewards from their closeness with both parents.

Collaboration leads to healther divorce outcomes

California parents headed for divorce court may be able to avoid an ugly fight if both parties are focused and make use of available resources. In the middle of a painful divorce, there could be temptation to extract revenge through the legal system, but doing so often puts children in the middle of a dispute between the two people they love the most. No divorce is pleasant, but keeping focus on the children involved will generally improve the actions and decisions of the parents during even the most unpleasant breakups. Learning to work together with the goal of child welfare allows parents to get past the hurt and work toward a common goal.

Often, the best starting place for negotiations is an even split of parenting time between the parties. Most jurisdictions have adopted the notion of 50/50 parenting rather than clinging to historical gender-based stereotypes. From the starting place, adjustments are almost always in order. Parents must be honest with themselves and each other regarding their ability and motivation for equal parenting. Work schedules and residential logistics sometimes mean that parents are unable to equally split time. If the parties remain focused on the children, they can learn to co-parent in a way that is conducive to emotionally healthy children regardless of parents' differences during the marriage.

Income tax implications following a divorce

The end of a marriage can come with major emotional and practical difficulties for California couples. However, the financial impacts can be some of the most important. For example, filing income taxes can be much different following a divorce.

Changes to income tax status go into effect right away after a divorce has been finalized, and they apply to the entire year in which the divorce was confirmed. Every year, income tax returns are due by April 15 of the following year. For the year the divorce was finalized, both former spouses must submit their returns as single filers. On the other hand, if the divorce was not finalized before December 31 of that year, divorcing spouses must file that year's returns as married, either jointly or as married filing separately.

Tips for dividing retirement accounts during divorce

When a couple in California decides to get a divorce, they will probably need to divide their property. This might include a retirement account that was originally intended to cover both spouses. Depending on the sort of account, the division process may be simple or more complex.

For what is known as a "qualified plan," such as a 401(k), a qualified domestic relations order may be necessary. With a QDRO, it is possible to divide the plan without being penalized for making an early withdrawal. Furthermore, it also allows the division to happen without either party being required to pay taxes on it.

Fight for your rights as a father to parent your child

In past years, divorced or unmarried fathers were relegated to roles akin to those of a backseat driver. They were able to shout, "Watch out!" when disaster loomed but had precious little control over the situation at hand.

Fortunately, the courts are now a bit more enlightened and recognize the legitimate role that dads have to offer their children. According to the federal Department of Education (DoE), when dads remain involved in their kids' lives, the children get better grades, learn more and display healthier behavioral patterns.

Are fathers' rights changing enough when it comes to custody?

There was a time when mothers had a distinct advantage when seeking custody of their children. Courts made decisions based on the assumption that mothers were positioned better to keep the kids, not fathers. Fathers who wanted to stay heavily involved in their children's lives had a difficult time after divorcing.

Fortunately, custody matters are evening out a little between the genders, although fathers' rights have a long way to go.

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