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5 Financial Tips for Facing Divorce

Friday, February 5th, 2016

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What’s your credit score? Will you be able to refinance the marital home if you keep it? What are your monthly expenses? What are the financial assets and liabilities that must be divided during your divorce? These are just a few of the questions you will face during the divorce process in Georgia. As Atlanta divorce attorneys, we know that facing the financial aspect of the divorce process can be overwhelming and frightening. One way to ease that fear and take control of your divorce process is to educate yourself, and to be as prepared as possible. Listed below are five steps you can take to prepare and protect yourself as soon as you are confronted with the prospect of divorce.

Gather and make copies of financial records and statements. Identify all of your jointly and individually held checking accounts, savings accounts, retirement accounts, investment accounts, and insurance policies, and print out or make a copy of the most recent statements. For you bank accounts, if you have access to the last years’ worth of statements, print or copy those as well. It is likely your divorce attorney will need these documents to determine what financial division is best in your case. In addition to your bank statements and insurance policies, also make a copy of your tax returns for the last three years, your mortgage statements, and any other documents relating to your finances. These documents will also help your divorce attorney resolve your case. Once you have gathered these important financial documents, be sure to store them is a safe place.

List your assets and liabilities. Make a list of every asset you own. When making this list, don’t just focus on the obvious assets, like the marital home or financial accounts. This list should also include assets like antiques, season tickets, family businesses, and rental property. Next, make a list of all liabilities, including every credit card or other debt. When making these lists, be sure to include everything, even items you or your spouse claim to own individually. In Georgia, every asset or debt accumulated during the marriage will be deemed marital property, unless some exception applies. So, it is very important that you have a full understanding of all marital assets and debts. Otherwise, you may lose out on your fair division of marital property.

Request your credit report. If you plan to keep you marital home post-divorce, it is likely you will have to refinance the mortgage into you name only. If you don’t have credit in your name alone, or if your credit is less than stellar, get a copy of your credit report and begin to establish and/or work to improve your credit now.

Keep a close eye on joint accounts. If at all possible, work with your spouse to pay off or reduce any jointly held debt. Also, check the balances of any jointly held bank accounts regularly. Sometimes, spouses considering or going through the divorce process spend irresponsibly or make withdrawals they otherwise wouldn’t make, to financial disadvantage the other spouse.

Make a budget. Making a budget is important for two reasons: 1) it is necessary to complete a Domestic Relations Financial Affidavit (which is basically a detailed budget) in almost every Georgia family law case, especially if the case involves child support, alimony or the division of property, and 2) a budget will show you exactly what your expenses are and how much income you need to meet those expenses. Making a budget will give you a head start on completing the Financial Affidavit, and will better inform you of what alimony amount of financial settlement would be economically best for you.

 

Are Child Support Payments Tax Deductible?

Friday, January 22nd, 2016

Many considering divorce, and even some individuals currently going through the divorce process in Georgia, are often surprised to learn that that alimony is tax deductible for the payor and treated as taxable income to the recipient spouse. After learning this information, the next logical question is: “Are child support payments tax deductible too?”

Unfortunately for non-custodial parents ordered to pay child support post-divorce, unlike alimony payments, child support payments are not deductible by the payor. Consequently, child support payments are not treated as taxable income to the custodial parent receiving the child support payments. So, if you are a non-custodial parent ordered to pay child support and alimony to your ex-spouse, be sure to keep track of the payments designated for alimony and the payments designated for child support for tax purposes. If you are a custodial parent receiving child support and alimony payments, it is also important for you to keep track of child support and alimony received separately. As an alimony recipient, you must include the alimony payments received when calculating your gross income for income tax purposes; however, you are not required to include the amount of child support payments received when calculating your gross income. Like with any question regarding income and taxes, be sure to speak with a certified public accountant or certified tax preparer when completing your tax returns.

Parental Abduction

Wednesday, December 30th, 2015

A recent article in the Atlanta Journal-Constitution tells the story of a 6-year-old boy who was recently abducted by his mother. Forsyth County Missing Boy, by Tyler Estep and J. Scott Trubey, The Atlanta Journal-Constitution, November 2, 2015. While the phrase “abducted by his mother” sounds strange, this is in fact what happened. The mother, who does not have any custodial rights, took the child triggering the issuance of an Amber Alert. After a daylong search, the mother dropped the child off at a friend’s house and is now in jail on contempt charges. Stories like this can be very scary to parents going through contentious custody battles. Though this child was not taken from a school, it is important to remember that most schools will release a child to his or her parent (with proper ID) no questions asked.  To decrease of parental abduction of your child, there are several documents you can provide to your child’s school:

  1. A copy of any custody order – The custody order will have the full parenting plan that details when the child is with each parent and who has decision making ability. While the school is unlikely to get involved if there is a dispute, it will be helpful if they at least know what is supposed to be happening. For privacy purposes, you can mark out any information that does not have to do with custody, such as any financial information, equitable division, alimony, etc.
  2. A list of people who ARE authorized to pick the child up from school – Most schools require this kind of written authorization when anyone other than a parent will be picking the child up from school. Make sure the school has a list for your child on file and update it as necessary.
  3. A list of people who ARE NOT authorized to pick the child up from school – Even though this list can be presumed by the absence of names on the authorized list, it may be important to have this, especially if there are any custody issues. As mentioned above, a school will likely release a child to a parent, no questions asked. However, if one parent has supervised visitation only, or is not allowed to see the child at all, the school needs to know so the child is not released to that parent in contravention of a court order.
  4. A copy of any Family Protective Order – If there are any family members (parents or otherwise) who are not supposed to have any contact with the child, the school needs to know. That way, if one of these people shows up at the school to get the child, the school will refuse to release the child and may also contact the proper authorities to have the person arrested for violating the TPO.

Some schools may be more open to facilitating custody issues than others but, either way, it does not hurt to provide the school with the information. At the very least, it can help provide you peace of mind that your child is safe when at school.

 

Divorce and the Standoff Over the Marital Home

Tuesday, December 22nd, 2015

Divorce is always a difficult transition. It can be made much more frustrating when one spouse is doing all he/she can to thwart the process and make it more difficult on the other spouse. Such is the case of a recently divorced couple in Texas. Divorce standoff at million-dollar home ends, by Kevin Reece, KHOU-TV, Houston, usatoday.com, October 9, 2015.

In that unusual case, the wife filed for divorce and kicked the husband out of their million-dollar house. The husband, however, refused to leave and camped out in his front yard, trying to convince his wife to change her mind about the divorce. Police were called numerous times, but could not remove him from the property per the wife’s request because the property was deeded in both their names. Finally, after the husband had been living in the front yard for five months, the Judge finalized the divorce and declared the wife sole owner of the home. Police then had the legal authority to force the husband to leave the property, which he did willingly.

The procedural details of this case are not mentioned in the article, but this situation likely could have been avoided, or at least significantly shortened, if the wife had asked for a temporary hearing on the issue of the marital residence. A temporary hearing can be requested when there are issues that need some sort of resolution while the divorce is pending. A temporary hearing results in a temporary solution – all issues will be re-heard at a final hearing. Use of the marital residence is a great issue for a temporary hearing especially when, as in this case, both parties are on the deed and neither wants to leave. If either party had requested a temporary hearing on this issue, the Judge would have heard evidence from both parties on why they should have use of the marital residence until the divorce is finalized. It is possible that the wife would have been granted sole use of the marital residence. It is also possible that the parties would have been ordered to share the residence – it was a million dollar house so, presumably, they could have stayed away from each other. Either way, it would have put an end to the lawn camping much sooner.

Is Paying Off Your Child’s Car Considered Child Support?

Tuesday, December 8th, 2015

Imagine that you purchase a car for your sixteen year old child. Later on, unforeseen things happen and you end up divorcing your spouse. If the court orders you to pay off your child’s car as part of the divorce, is that considered child support? The Georgia Court of Appeals recently considered a similar situation.

In Partridge v. Partridge, Mr. and Mrs. Partridge were married on December 30, 1994, and had two children together. Partridge v. Partridge, 297 Ga. 272 (2015). The parties were divorced pursuant to a June 2, 2014, Final Decree, and as part of the Final Decree, “the trial court ordered, among other things, that Husband ‘shall continue to make monthly payments on the minor child’s automobile, which is currently in her possession, until said automobile is paid in full.’” Id. at 272-73. Mr. Partridge contended that the trial court erred by ordering him to pay the car payments on the minor child’s automobile, since “those car payments constituted an improper deviation from the amount of child support that Husband was legally required to pay.” Id. at 274.

Notwithstanding, the Appellate Court asserted that Mr. Partridge’s “characterization of these car payments as ‘child support’ is misplaced.” Id. The Appellate Court noted that “testimony at the final hearing established that this car was purchased during the marriage, and that both Husband and Wife were joint obligors on the indebtedness owed on the car. Accordingly, this marital debt could be properly addressed by the trial court through its equitable division of the parties’ marital property.” Id. at 274 (citing Moore v. Moore, 286 Ga. 505 (2010)). Therefore, the Appellate Court held that there was no abuse of discretion in the trial court’s decision to make Husband responsible for the continued payments on this marital debt as part of an equitable division of the parties’ property. Id. at 274 (citations omitted).

By: Jason W. Karasik, Associate Attorney, Meriwether & Tharp, LLC

No Joint Custody Between Parents and Grandparents in Georgia

Wednesday, December 2nd, 2015

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There is no doubt that Georgia law recognizes how important it is for grandparents to play an active role in the lives of their grandchildren. In fact, Georgia’s Grandparent Visitation Statute expressly permits grandparents to establish legal visitation rights with their grandchildren under certain circumstances. Although Georgia law respects the rights of Georgia grandparents, a recent Georgia Supreme Court case reaffirms that joint child custody should be reserved for parents.

In Stone v. Stone, S15F0064 (Ga. June 29, 2015), the Supreme Court considered an order entered by a trial court awarding joint custody of the child to the child’s father and maternal grandmother. David Stone (husband/father) and Annna Stone (wife/mother) divorced in January 2014.  The parenting plan incorporated into the couple’s final divorce decree awarded joint legal custody of the couple’s minor child to Husband and the child’s maternal Grandmother. Husband was granted primary physical custody, Grandmother was awarded visitation rights, and Wife, who the court found was unfit to have custody of the child, was given only a potential for future visitation. On appeal filed by David Stone challenging the trial court’s custody determination, the Georgia Supreme Court held:

[…][T]he trial court in this case had no power to grant joint custody to Husband and Grandmother, and that award must be vacated. This result does not mean, however, that the statute does not respect and promote the interaction of loving grandparents with a minor child. To the contrary, the statute encourages contact with grandparents in O.C.G.A. § 19-9-3 (d), and O.C.G.A. § 19-7-3 provides a mechanism for a grant of visitation rights to grandparents when necessary to ensure and preserve this contact. Also, in situations where neither parent is suitable to have custody, a grandparent might certainly be “a person” qualified to have sole custody of a minor child. However, in situations where a parent is suitable to exercise custody over a child, the statute does not allow that parental custody to be limited by a joint custody arrangement with a grandparent or, for that matter, any other person.

Id. Put plainly, the Georgia Supreme Court determined that although grandparent’s right to grandchild visitation should be respected, Georgia law does not recognize joint custody arraignments between parents and grandparents. Joint custody may only be shared by parents.

 

Paying Your Child’s Private School Tuition? This May Count as Child Support

Tuesday, November 24th, 2015

This summer, the Georgia Court of Appeals addressed a case involving the payment of a child’s private school tuition in lieu of paying child support directly to the child’s custodial parent. Although it is never advisable for a parents to ignore or unofficially modify a court’s child custody or child support order, the case of Jackson v. Sanders, A15A0127 (Ga. Ct. App. July 16, 2015), seems to suggest that payment of a child’s expenses may count as child support.

In Jackson, the couple divorced in 2001, when their son was less than a year old. As the non-custodial parent, Jackson (father) was ordered to pay Sanders (mother) $1,005 per month as child support for the benefit of their minor child. Jackson paid child support as ordered until 2012, when both parents agreed that instead of paying child support directly to Sanders, Jackson would pay an equivalent amount to N. J.’s new private school for Sanders’s half of the tuition. In Sept. 2012, Jackson filed a motion to modify child custody. In response, Sanders counterclaimed seeking over $14,000 in unpaid child support. Although Jackson responded to Sanders claim by showing he did indeed provide support to his son by making payments toward his private school tuition, the trial court nevertheless found that Jackson owed over $27,000 in unpaid child support.

Jackson appealed the trial court’s decision, and the Court of Appeals ultimately sided with Jackson holding:

The trial court was indeed correct that, “while parties may enter into an agreement concerning modification of child support, the agreement becomes an enforceable agreement only when made the order of the court.” Nevertheless, our Supreme Court has recognized that there are certain equitable exceptions to that general rule. And included among these “equitable exceptions are situations where the mother has consented to the father’s voluntary expenditures as an alternative to his child-support obligation, or where the father has been in substantial compliance with . . . the divorce decree, for example, where he has discontinued child support payments while he had the care and custody of the children and supported them at the mother’s request.

Here, Jackson and Sanders did not modify the amount of Jackson’s child-support obligation as set forth in the 2001 Judgment. Instead, they merely agreed that Jackson would pay an equivalent amount for Sanders’s half of N. J.’s private-school tuition as an alternative to paying her directly. And our Supreme Court has held that such an agreement was valid under nearly identical circumstances. Thus, the trial court erred in ordering Jackson to pay $27,135 in past due child support, and we reverse its judgment in this respect.

Id. (Quotations in original. References omitted).  Thus, when read with prior Georgia cases addressing this issue, Jackson may indeed allow for non-custodial parents to pay children’s expenses, such as private school tuition, in lieu of direct child support payments to a custodial parent. See Nagle v. Epstein, 241 Ga. 612, (1978) (affirming the trial court’s judgment that the husband was not in contempt for failing to pay past-due child support when he testified that the parties agreed that the wife would accept the his payment of their son’s private-school tuition in lieu of an equivalent amount of past-due child support and the wife did not testify otherwise).

What is Promissory Estoppel, and How Can It Impact My Georgia Divorce?

Sunday, November 22nd, 2015

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Promissory estoppel is not a legal concept generally associated with divorce, child support or any other issue of family law. But, if you are considering divorce and you have been serving as a guardian or primary caretaker of a child her in Georgia, this legal principle may be applicable to your case. The Georgia Court of Appeals has addressed the issue of promissory estoppel in child support cases on more than one occasion. But, the case of Mooney v. Mooney, 235 Ga. App. 117 (1998), is especially instruction on when and how promissory estoppel has the potential to impact divorce proceedings.

In Mooney, the wife agreed to become the guardian of her grandchild, but only if her husband promised to help support the child. Husband and wife subsequently divorced. Although the parties both contributed to the child’s support during the marriage, no provision for child support was made during the divorce. Later, wife filed an action seeking child support from her former husband. The trial court initially dismissed wife’s action, ruling that husband could not be compelled to support his grandchild absent some explicit agreement to do so. However, on appeal, the Georgia Court of Appeals concluded that wife should be able to proceed with her action seeking child support on the theory of promissory estoppel. Id.

Although wife failed to succeed on her claim for child support, the Court of Appeals allowed the wife in Mooney to proceed with her action because she was able to put forward at least some evidence that her husband promised to provide support for their grandchild and that she relied on his promise. Ultimately, wife failed to succeed on her claim for child support based on the theory of promissory estoppel, because she was unable to make two additional showings: 1) that husband promised both her and the child that he would assume responsibilities of fatherhood and 2) that husband held himself out as the child’s father. Wright v. Newman, 266 Ga. 519 (1996); O.C.G.A. § 13-3-44.

If you are considering divorce in Georgia, and you are concerned that promissory estoppel may impact your divorce, or if you simply have more questions regarding this topic or any other divorce related topics, please review our other helpful articles and blogs or give us a call to speak with one of our family law professionals.

Women More Likely To Initiate Divorce

Tuesday, November 17th, 2015

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Divorce attorneys see both men and women initiating divorce actions. Sometimes the husband and wife even want to coordinate and file at the same time. Practically speaking, in the eyes of the court, it doesn’t matter which party files the Petition for Divorce first. It may make a difference to the parties involved, however, and there are trends showing which spouse is more likely to initiate the action.

A recent Stanford University study found that women are much more likely than men to initiate a divorce. Women Initiate Divorces More Than Men, But Not Breakups, Study Suggests, by Brittany Wong, The Huffington Post, August 24, 2015. The study followed adults with opposite sex partners for six years, and analyzed their breakup statistics. Interestingly, while women were found to have initiated 69% of divorces, the initiation of breakups between non-married couples was nearly equal between the genders. The study’s author found this to be an interesting phenomenon “because social scientists previously argued that women were more likely to initiate divorce simple because they were more sensitive to relationship difficulties.” This is not the case, however, since women are not the primary initiators in non-marital breakups.

There could be several reasons for this disconnect. Marriage is a significant commitment to another person and women may be less likely to remain committed in such a permanent way to a person with whom they are no longer happy. For unmarried women in relationships, the commitment may not seem as significant and, thus, they may not feel the need to remove themselves from the relationship. In addition, if a woman feels she could be happier with someone else, getting divorced, rather than having an affair, may be an easier pill to swallow. An unmarried woman in a relationship may not see an affair as that significant without the marital vows; thus, cheating on a boyfriend, rather than breaking up with him, may be the chosen solution.

What is FERPA?

Tuesday, November 3rd, 2015

FERPA, or the Family Educational Rights and Privacy Act, is a Federal law that protects the privacy of student education records. 20 U.S.C. § 1232g; 34 CFR Part 99. According to FERPA, all parents have certain rights regarding access to their children’s educational records. These rights include equal access to their child’s educational records, the right to seek the correction of any inaccurate or misleading information contained in their child’s records, and the right to prevent the disclosure of information contained in their child’s educational records under certain circumstances.

It is important for all parents, both custodial and non-custodial, to be aware of their rights according to FERPA, because under FERPA, all parents enjoy the rights listed above, regardless of whether a parent shares legal custody of their child with the other parent. This is because FERPA defined the word “parent” as a natural parent, a guardian, or an individual acting as a parent in the absence of a parent or guardian. Thus, under FERPA, a parent has the right to access their child’s educational records, despite not having legal custody or final decision making authority regarding educational issues. Put another way, neither the school district, nor the custodial parent, has the right to deny a non-custodial parent’s request to access their child’s educational records. The only way a parent would be deprived of this right is in cases where a court order exists that specifically revokes this right.

It is generally uncommon for court’s to specifically preclude one parent’s access to their child’s educational records. So, if you are a parent who has been denied access to your child’s educational records, please know that you are entitled to access according to this important federal law. Keep in mind though, only report cards, standardized test information, individualized education program plans, and similar information are considered educational records. Information such as this may be requested. On the other hand, general information regarding your child’s progress in school, lunch menus, PTA information, school calendars and extracurricular activity calendars are not considered educational records, and may not be demanded under FERPA.