Florida is an equitable distribution state. This means that debts in a divorce are split fairly. This means that they could be split 60/40, 70/30, or even equally, at 50/50.  This primarily depends on whether or not the debts are jointly shared or are separate.

Credit card debt is often difficult to split in a divorce, since many couples have joint accounts. If this is the case for you, who is responsible? Ideally, you should enter a divorce with no joint debt, but that is not always realistic. If you are considering divorce, here are some tips to keep in mind as you navigate the division of debt.

What to Do About Debt

If you do have joint debt in your divorce, there are some things you can do to make the process of splitting the debt less painful. The first thing you should do is cancel the credit cards so your spouse cannot make any more purchases and rack up the debt even higher. If your spouse does happen to incur more debt, keep accurate records so you can prove that you were not the one who made the purchases. Your spouse should be held responsible for his or her purchases.

Determine how much debt there is and make a plan to pay it off together. It may be easier to transfer the debt to a credit card that is solely in your name so it can be paid off quicker.  If you have a home equity line or credit or any savings, use that toward your debt to help with the payoff. If you need help, seek assistance from a financial planner or mediator.

If you and your spouse are both drowning in debt and will have trouble paying down the debt, seek credit counseling. A counselor can help you manage your expenses and help you create a budget. If your debt is significant and it will take you many years to pay off, bankruptcy may be a good option. You should file before the divorce so your spouse isn’t stuck with the joint debt.

Seek Legal Help

Splitting assets is never easy in a divorce. The same goes for debt. There are various types of debt that may be involved in a divorce, and deciding who pays for what can be complicated, especially when it comes to joint accounts.

Let Fort Lauderdale property division attorney Edward J. Jennings, P.A. assist you during this stressful time. We can help divide assets and debts fairly. Fill out the online form or call (954) 764-4330 to schedule a consultation.

Resource:

creditcards.com/credit-card-news/help/dividing-credit-card-debt-divorce-6000.php

https://www.ejj-law.com/how-commingling-changes-the-classification-of-assets/

Three Commingling Theories

According to the Florida Bar, Florida recognizes three ways by which assets may go from being separate to being marital. Those three theories are as follows:

• Strict Transmutation
• The Tracing Approach
• Intent of Parties

Strict Transmutation 

Per this theory, when a couple mixes marital and nonmarital funds, all nonmarital contributions suddenly transform into marital assets. In cases such as these, the courts will not consider any other factors, which it justifies by stating that money is “fungible,” and once commingled, it loses its separate status. The courts define “fungible” as something being commercially interchangeable with other property of the same kind.

The courts may apply this theory if you, say, sell a separate property and place the proceeds from that property into a joint checking account from which both you and your spouse can pull funds.

The Tracing Approach 

If the courts use this approach, one spouse might be able to stake claim to some of his or her previously separate property by tracing the assets back to before they were commingled. For instance, if you purchased your home prior to tying the knot, you may be able to prove you have greater equity in the home than your spouse by presenting mortgage statements, purchase records, and bank records showing how much you contributed prior to the marriage. If your now joint account used to be your sole account prior to the union, and if you had a substantial amount of money in the account before adding your spouse’s name to it, you can use account statements to trace how much of the remaining funds should rightfully belong to you.

Intent of Parties 

The courts will generally refer to the intent of parties approach when an inheritance is involved. When determining whether or not a gift is separate property, the courts will consider the intent of the recipient spouse. For instance, did the recipient place the funds from a deceased grandparent into a separate account to which only he or she had access? If so, the courts will likely classify the gift as separate. However, if the recipient spouse used some of the funds to improve the family home and then used the remainder of the funds to pay off the mortgage and contribute to other familial bills, the courts will likely classify the gift as marital property. If you wish for gifts or inheritances to remain separate, the key is to never intermingle them with the other party’s or joint funds.

Contact a Fort Lauderdale Property Division Attorney 

If you have questions regarding your marital and separate property, or if you want to ensure that your separate property does not go to your spouse in your divorce, reach out to a knowledgeable Fort Lauderdale property division lawyer for guidance today. Contact Edward J. Jennings, P.A., today to schedule your initial consultation.

Resource:

floridabar.org/the-florida-bar-journal/the-commingling-of-nonmarital-and-marital-funds-untangling-the-changing-character-of-assets-in-equitable-distribution/

https://www.ejj-law.com/protect-your-business-assets-in-divorce-heres-how/

When Your Business is a Marital Asset in Florida 

Whether you formed your business before tying the knot or afterward does not matter to the Florida courts. Under Florida Statute 61.075, any nonmarital property that was enhanced in value over the course of the marriage thanks to the physical or monetary efforts of either party is considered a marital asset ((6)(a)1.b). Additionally, all income earned from nonmarital assets during the marriage and that was treated, used, or relied upon by both parties as a marital asset, is also considered a marital asset ((6)(b)3.).

For instance, if your spouse contributed to the growth and success of your business in any way—even if it meant that he or she stayed at home with the kids so that you could invest all of your time into growing your company—it is a marital asset. If your spouse worked overtime so that he or she could pay the bills while your business struggled, your business is considered a marital asset. If you and your spouse used the income from your business to pay the bills, save for retirement, pay for health insurance, or go on vacation, it is considered a marital asset.

How to Save Your Business Assets From Distribution 

The most effective way for business owners to keep their business assets from being divided in a divorce is to draft a legally valid prenuptial agreement. Though not romantic, a prenuptial agreement can set financial expectations and responsibilities for each spouse. It can also help each spouse determine what part of the small business, if any, will be marital property and what percentage will remain separate.

Of course, if you are reading this, you are likely beyond the “agreement” phase. If you have yet to file for divorce, and if you and your spouse are still somewhat civil, consider forming an LLC or Corporation. Both an LLC and Corporation are separate entities, which means that any assets that the business owns are, well, the business’s.

However, keep in mind that any marital assets used to pay for the business’s expenses can either be subtracted from your overall settlement or used to determine whether or not the company is actual marital property. If you choose to go the entity-formation route, you need to be careful in how you do so, and that you do not overstep any legal boundaries.

Really, the best way to protect your business assets is to maintain a good working relationship with your ex. Though this is easier said than done, a divorce mediator can help the two of you communicate in a civil manner and come to an agreement that makes he or she happy and that preserves the financial integrity of your business. If mediation is not an option, a skilled divorce lawyer can negotiate on your behalf with the opposing counsel to ensure the best possible outcome.

Retain the Help of a Skilled Fort Lauderdale Divorce Lawyer

If you own a business and are about to embark on the divorce process, you need to retain the help of an experienced Fort Lauderdale property division lawyer. Your livelihood is at stake, and one wrong move may be the difference between saving your business and being forced to sell it or its assets for the sake of fair property division. Do not let your livelihood be affected by your love life. Contact the office of Edward J. Jennings, P.A., to discuss your options today.

Resource:

leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=0000-0099/0061/Sections/0061.075.html

Wisconsin was the first state to propose the implementation of pet custody laws, and while that bill never did pass, it set the precedence for other states to follow. As of January 1, 2018, Illinois is the second state to implement pet custody laws, with Alaska being the first last January. In both states, divorce court judges are required to take into consideration the best interests and wellbeing of the pet, which gives the judge the right to assign sole or joint custody as they see fit. The new laws even leave room for the possibility of “pet support,” or monetary support for the pet.

Why “Pets as Property” Might Not Cut it Anymore 

Until recently, all divorce courts treated pets as another piece of property. Some courts would grant ownership of the pet to whichever parent had the children more often, while others would determine that the pet should stay with the primary caretaker. However, in a world where people are having children less, and in which it is common for two pet owners to share equal pet-rearing responsibility, such “property division” techniques do not work. The courts could try to get one parent to “buy out” the other’s share in the pet, but most pet owners today are not likely to stand for that, given they view their furry loved ones as children and not lawn ornaments or pieces of furniture. States like Alaska and Illinois recognize this and are willing to work with pet owners, but what about the others?

Pet Custody is Just One More Cog in an Already Overwhelmed System 

Unfortunately, the truth of the matter is that the court systems are already overwhelmed as is, without adding pet custody to the mix. In an ideal world, pet parents would be able to work out an enforceable shared visitation schedule for their pets without causing a drain on the system, but in an ideal world, they would be able to do the same for their children. Unfortunately, we don’t live in an ideal world, and just like many child custody cases often turn into battles, many courts perceive the same thing happening with pet custody cases. As of right now, with the legal system as it is, many states do not have the resources to oversee pet custody hearings, much less enforce visitation schedules and pet support payments.

Your Options for Retaining Custody of Your Pet in Florida 

Though Florida is one of those states that does not have the resources to deal with pet custody judicially, that does not mean that you and your spouse cannot work out an agreement between yourselves. If you and your spouse own one or several pets together, and if neither of you can imagine getting along without your furry friend(s), you may want to consider drafting a pet custody agreement between yourselves that lays out a viable custody arrangement. This agreement is a legal contract, and though it is unenforceable by the family courts, if notarized, it can be enforced like any other legally binding contract.

At the office of Edward J. Jennings, our goal is to help divorcing couples through the dissolution of their marriage as effectively and painlessly as possible. If that means helping you draft a pet custody agreement, that is what we will do. Schedule an initial consultation with one of our skilled Fort Lauderdale divorce attorneys by calling our office or requesting an appointment online today.

Resources:

cdc.gov/nchs/nvss/vsrr/natality-dashboard.htm

chicagotribune.com/news/local/breaking/ct-met-pet-custody-law-20171218-story.html

washingtonpost.com/news/animalia/wp/2017/01/24/in-a-first-alaska-divorce-courts-will-now-treat-pets-more-like-children/?utm_term=.e630b3afb339