Do you know how marriage and/or divorce will affect your taxes and financial planning? There are many choices that need to be made—and some of them will be made for you if you do not properly plan. Many things, such as areas of finance, personal-life questions, and some basic laws, will be addressed. Please note that I am not an attorney, nor is anything here to be construed as legal advice; rather, the objective is mediation in a non-adversarial setting.
Prior to marriage or divorce, a sample tax return should be prepared to see just what happens, but very often this isn’t done.
I would never discourage anyone from getting married; it is, as the saying goes, a wonderful institution if you want to be institutionalized. It is, however, in our experience that 90% of people getting divorced do so because they failed to address certain financial and family concerns prior to marriage. The goal of premarital financial consulting is get both parties to discover where they differ and agree so that they can work on issues before they marry. There are many things to consider and our questionnaire will begin the process. Our service is designed to open communications on several financial fronts that people often overlook. While one person can come in for advice, this approach seldom works; in fact, if only one of you wishes to attend, that might be the first issue that you discuss before making an appointment. Marriage is a partnership; two make it work or two make it fail.
Getting married is about more than wedding rings. Proper financial planning is vital for the soon-to-be newlyweds, as it is for anyone. Divorce is usually ugly. No matter how amicable things start out, I have yet to see a true friendly divorce when there are any assets, debts, or children involved. This program is designed to help you understand the divorce process, understand basic divorce law, and understand that if the parties will not agree then the court will decide. Allowing the courts and lawyers to decide your fate is always costly and foolish. The goal of this service is save emotional stress and legal costs. It is best if both parties can come in together as this is good practice for state required mediation. In fact, agreeing upon terms might negate mediation and wasted court time.
Some basics that you need to accept:
- There are piles of federal and Maine state laws to take into consideration before getting married or when planning to divorce. Don’t fall into the trap of accepting common-law myths or other word-of-mouth urban legends about marriage and divorce. Talk with a financial consultant to be sure that you both know what you’re doing.
- If you lived together prior to marriage that time does not count as married time. Maine does not recognize so called common law marriages nor does it recognize palimony.
- Maine law splits marital assets and debts 50-50. The chances of an uneven split are remote at best and generally speaking the fees paid to lawyers and courts exceed any true benefit.
- Alimony is available after 10 years of marriage for up to 50% of the marriage time. Alimony is not a guaranteed right in Maine.
- If you’re married more then 10 years, pensions and Social Security rights are protected under federal law. Receiving funds from pensions after divorce takes careful planning to avoid tax penalties.
- While debts are split, creditors are not subject to the divorce decree. This means that even if your ex is ordered to pay 100% of a debt, his or her failure to pay means the creditor will come after you.
- You cannot declare bankruptcy on debts that have been addressed in a divorce degree. Thus you cannot escape the order to pay any debt that has been assigned to you via bankruptcy.
- Custody in Maine will, with only extreme exceptions, usually be joint. The reasoning is that if both parents are involved in the decision process of the needs of the children, the children will continue to have strong ties to both parents.
- Child support is mandatory. You cannot forfeit your child’s right to support nor generally can you get out of support payments. At times giving up parental rights and obligations does excuse one from support payments. However, the courts will look at whether or not the residential parent can support the child without creating a burden on the state before granting such a request.
- Inherited property, unless you created an encumbrance or so mingled with spouse, is not marital property.
Once again, I am not an attorney and unless the parties can totally agree on all aspects of the divorce settlement then they should each hire their own attorney. I gladly prepare sample tax returns and do financial statements for your attorney.