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There are many financial issues to consider in a divorce case. One of the most significant issues is the division of property. “Property” includes both physical assets, such as a home, vehicles, bank accounts, etc., as well as deferred compensation, such as pension plans, 401ks, and stock plans. “Property” also includes debts. In a Santa Clara County divorce case, and in California at large, community property laws govern the division of all property. In general, in California, all property acquired during marriage is “community” in nature and must be divided equally upon divorce. All property acquired prior to marriage, or after separation is the acquiring party’s “separate” property. Additionally, any property acquired during marriage by gift, bequest, inheritance or the like, is “separate” property, as well. The characterization of an item of property as “community” or “separate” will determine how the item is divided in a divorce.

At a basic level, “community” property must be divided equally, while “separate” property is confirmed to the party who acquired it. In reality, the division of property is not quite so simple. Often times during marriage, “community” and “separate” property become mixed, or “commingled.” In that case, it needs to be determined whether it is possible to “trace” the separate property so that it can be returned to the separate property owner. Additionally, issues can arise when property is purchased during marriage, but only put in one spouse’s name. The value of assets can also be an issue.

Other financial issues to be considered include how funds are spent after parties separate. There are specific automatic orders that go into place once a party is served with divorce paperwork, preventing both parties from transferring/moving funds and/or making large purchases without the agreement of the other spouse or a court order. Additionally, each party’s income and expenses should be taken into account, to determine whether spousal and/or child support are appropriate. When setting support, it is important to know what constitutes “income” for purposes of determining support. Income is not necessarily limited to funds earned from employment, but can include commissions, bonuses, rental income, stock proceeds, interest, unemployment and disability benefits, and the like. Another consideration when setting support is whether both parties are working. If not, the court can order one or both parties to seek work so that he/she is able to contribute to the support of the minor children and/or so that he/she can become self supporting, for purposes of spousal support.

There are many things to take into consideration when you are considering initiating a divorce action in California. The State Bar of California website has a general checklist for what you need to know about divorce and custody, which is a great resource for parties involved in, or thinking about filing for divorce and/or custody. The following are the areas addressed in the article:

1. What are the grounds for divorce in California?

The goal in a divorce case is, obviously, to get divorced. But, once the final judgment of dissolution is entered, property is divided, support is determined and issues surrounding custody and visitation are resolved, its important to note that there may still be additional things that you need and/or should do to protect yourself and your assets. What follows is a sort of “post-judgment checklist” that should be considered by any party to a divorce, once the actual divorce is finalized.

Create a New Will

One of the more important items for you to consider is the drafting of a new will. California Probate Code 6122 states that the dissolution of your marriage revoked any disposition of property made by you to your former spouse. The state reacts in the matter as if your former spouse had predeceased you. The dissolution of your marriage also revoked any provisions you made in your former will conferring powers of appointment on your former spouse, and it revoked any provision nominating him/her as executor, trustee, conservator or guardian. Therefore, you likely need to make other plans for the disposition of your property and appoint another executor if you had named your former spouse as executor in your previous will. Also, if there was a trust or guardianship for any minor children, you need to consider the fact that, although your former spouse would be the guardian of the person of your minor child/children, you have the option of naming another person or institution as guardian or trustee of the estate of the child/children.

Minor’s counsel must act in the best interests of the child and represents only the child. Their role is to consider the best interests of the child without being bound by the emotions that often come with contested child custody cases.

Minor’s counsel acts as neutral voice for the child. They do not prefer one parent over another and they do not act on behalf of either or both parents.

In California child custody cases, minors are rarely allowed to testify in court or speak with the Judge directly. Only in very rare circumstances does this occur. But, children have a right to be heard and therefore, Judge’s will often appoint minor’s counsel to interview a child about their concerns and preferences as it relates to custody.

When going through a divorce, the best case scenario is that everyone remains amicable and the need for litigation is avoided.

However, if litigation is inevitable, both sides at least want to try to come out of the process financially secure. These are common mistakes, all of which are avoidable, but all of which almost always end up costing you when going to court:

1. Going to court without a lawyer

President Trump’s tax reform bill, which was recently signed in to law, includes many changes to the United States Tax Code.

Some of those changes will in all likelihood directly affect California Family Law cases including divorce cases, custody cases and support cases. Child support and spousal support are two of the significant areas of Family Law likely to be affected by the new tax changes. Specifically:

Child Support: Currently the California guideline child support calculator uses a number of factors, including each parent’s tax bracket, filing status, deductions, including mortgage interest and property tax deductions, and personal exemptions to determine the amount of child support owed. Under the new tax laws, nearly all of those factors have been modified. The tax brackets have been revised such that many people will enjoy a lower tax rate. Additionally, the standard deduction has roughly doubled for all taxpayers. However, the personal exemption for the taxpayer, his/her spouse and children, has been eliminated. Additionally, the amount that can be deducted for mortgage interest has been reduced to include debt of up to $750,000, down from $1M. All of these changes may affect how much a supporting parent could have to pay for child support.

Asking your soon to be spouse to sign a prenuptial agreement is a subject that is guaranteed to cause tension. Thinking about the end of a marriage before it has even started can be very difficult, but at times, necessary.

A recent survey of the American Academy of Matrimonial Lawyers recently showed that 62% of clients, particularly millennials, are now requesting prenups prior to getting married. There are a variety of reasons for this, but regardless of the reason, a prenup is typically a topic that no one wants to discuss. However, there are ways to have the discussion with your partner in a collaborative and positive manner that may ultimately make everyone in the relationship happy as outlined in the article below:

You may think that both parties are required to participate in a divorce. You may even think that you need the other party’s consent to get a divorce.

However, under California law, only one party is required to participate in a divorce action. A party who has been properly served with divorce papers cannot prevent the divorce from going forward simply by ignoring the other party. While it is always more beneficial for both parties to participate in the divorce proceeding, there is a silver lining to proceeding by default. The court has the ability to enter a default judgment, or a judgment based on your papers alone, if your spouse does not file a response within the allotted time frame. The party requesting the default must follow the required procedures as outlined below.

A party who has been properly served with divorce papers cannot prevent the divorce from going forward simply by ignoring the other party.

Becoming a single mom in your 30s might sound like everyone’s worst nightmare.

You have married the man that you thought would be your partner forever, you have a young child or even several children at this point and you are faced with the prospect of a divorce. All of the usual thoughts run through your head: How will I raise a child on my own? How will I explain to my young children that mom and dad no longer want to live together, how will I meet someone new?

While all of these questions can be very daunting and scary to face, as one single mom put it, she was no longer stuck in the “birdcage” that had become her marriage and was able to discover her own happiness in the face of divorce. This was not only incredibly important for her, but for her child as well. She was able to become the best mother she could be to her young toddler without worrying about the unintended consequences of a high conflict relationship. She could face her 40s and a new relationship without all of the pressures many feel throughout their 30s to get married and have children. That gave her a sense of peace in raising her son and taking her time to find an ideal partner before committing to a new partner

As reported last week on, a final judgment of divorce was entered in the Johnny Depp and Amber Heard divorce case.  Along with an approximately $7M settlement, Amber also received the parties’ dogs, “Pistol” and “Boo.”

Although not an issue that comes up often in divorce cases, there can be a dispute as to who should get to keep the family pet. Many people assume that determining who gets a family pet is a “custody” issue. However, the law is clear that pets are personal property to be divided in the same manner as any other item of property, such as a vehicle. It is highly unlikely thus, that a Santa Clara County family law court would entertain requests for custody of a pet, or a timeshare plan. Rather, in the event of the dispute, the court would more likely determine whether the pet is “separate” property or whether it is “community”. If the pet was owned by one party prior to the marriage, or purchased with a party’s “separate” funds, then the pet would be confirmed to that party. If, however, the pet was purchased during marriage, with “community” funds, the analysis is not so simple. The court could look at factors such as the parties’ respective psychological attachments to the pet, whether one party was the sole or primary caretaker of the pet, etc. The division of a pet can be difficult because often both parties are attached to the pet, and simply offering to buy out the party who does not get the pet, as would happen with a vehicle, for example, would not compensate that party for the emotional attachment to the pet.

Even though pets are treated as items of property for purposes of deciding who gets to keep the pet in a divorce case, the court MAY include a pet in a Domestic Violence Restraining Order. California Family Code Section 6320(b) provides that the court may grant one party exclusive possession of an animal and it may order a party to stay away from said animal, on a showing of good cause.

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