For those finalizing before April 15th, you may be filing separately, but do you have all of the information you need from your spouse to complete your tax returns?  Be sure your Final Decree addresses this by adding deadlines.

For those finalizing after April 15th, how will you be filing?  Who will be completing the tax returns?  How will refunds or payments be split?  Sometimes a spouse will file separately and take the deduction for the children, tell the spouse that he/she is filing jointly, and then not tell the other person that he/she really filed separately.  The filing spouse gets the refund, and the non-filing spouse ends up never filing a tax return!

It’s important that you give serious thought to these and other issues, and that you stay on top of what your spouse is doing.  Be sure to talk to your attorney about taxes, too, since many attorneys often overlook this simple matter.

http://thechart.blogs.cnn.com/2012/01/19/sex-after-divorce-does-it-get-better/

When it comes to marital finances, often the best defense is a good offense.  From the very beginning of your marriage, make sure that you are an active participant in all of your financial affairs. Have full knowledge of all marital assets, liabilities, income and expenses, and know where all copies of tax returns and other financial records are located.

If it’s now too late for preventive measures, and you’re already in the throes of divorce, my advice is different. First, you may want to strategize your next financial steps with a divorce financial expert.  Second, you should immediately start to be on the lookout for these tell-tale signs that your husband [spouse] may be hiding assets and/or income:

1. Bank and other financial statements are no longer being delivered to your home address. A change in regular delivery could signal that marital assets are being diverted or dissipated.  Check with your bank, credit card companies, etc. to make sure that you receive copies of your statements. You’ll want to start gathering these, as well as tax returns, pension/IRA/401K statements and other financial documents, so that you can keep your own records and be alerted to any unusual activity.

2. A sudden decrease in salary. Any dramatic decrease in salary may indicate that your husband has decided to defer salary and/or hold commissions and bonuses for future distribution.  (That way this income won’t be “on the books” until after the divorce is final.)

3. Intentional overpayments. What happens if your husband overpays the IRS (or other creditors)? He’ll get a refund later –presumably after the divorce is final. I’ve also known cases where people fabricate loans from family members. The idea here is that they can lower their bottom line by listing these debts in their financial statements or sending the family member cash to “pay the loans,” knowing that the family member will return the funds after the divorce. You should also watch for money that might be transferred to your child’s (or his child’s) name.

4. No new clients. But, surprise! New employees. If your husband owns a business, there are many different ways he can “cook the books” in order to make the business appear less valuable than it is.  Maybe he’ll pay employees who don’t exist, or “pay” friends and family who agree to hold the checks until after the divorce is final. He could also delay signing new clients until after the divorce settlement is signed. Remember: The less the business is worth, the less you’ll get.

5. Defensive behavior. A husband who suddenly becomes secretive, controlling or defensive about money could be someone who is diverting or dissipating marital assets. A forensic accountant can help you uncover this type of deceitful activity.

Husbands hide assets and income for a variety of different reasons. He may feel he’s getting revenge for an infidelity.  He may fear not having enough money after the divorce. Maybe he’s just greedy and feels that he deserves it! Whatever the reason, hiding assets, income and debt is unethical, immoral, illegal and subject to severe penalties when discovered.

However, the burden of proof is often on the spouse with less financial resources (typically the woman) to prove any such unscrupulous behavior. That’s why women must play it smart. Work with a qualified divorce team to help ensure that you have the professional expertise and support required to receive a fair settlement, keep your finances intact and secure your financial future.

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Written by: Jeffrey A. Landers, CDFA™ is a Divorce Financial Strategist™ and the founder of Bedrock Divorce Advisors, LLC

To be enforceable, the agreement should be in writing, signed by both spouses, entered into without coercion or undue influence, and be fair and equitable.  If the agreement partitions, exchanges, or converts marital property, then it should also conform to the statutory requirements under the Family Code.

If you are interested in creating a separation agreement with your spouse, contact our office to set up a consultation.

Taxes.  For many years, couples faced a “marriage penalty” in which joint filers paid more in taxes than if they were single.  However, recent tax cuts brought some relief.  For example, the standard deduction for married joint filers is now twice the amount for singles.  And joint filers with children and jointly owned property also enjoy certain tax benefits.  Additionally, the federal estate and gift taxes offer other perks to married couples, in that a person can usually leave unlimited amounts to their spouse free of such taxes.

Social Security and Retirement.  For individuals who were married for at least 10 years and meet other requirements, such persons can collect social security benefits based on a spouse’s work history and receive more than they may have otherwise as a single person.  Similarly, some employer retirement benefits have survivor protections and the payouts will automatically go to a surviving spouse if a person dies, even in situations where there is no named beneficiary.

Health Insurance.  Although more and more employers are providing benefits to domestic partners, the playing field is still far from even.  Married couples may benefit from reduced premiums and extended coverage that they might not otherwise get as singles, and from pre-tax contributions by the other spouse and/or employer into various medical spending accounts.

Collective Property.  Certain types of property can be more easily co-owned by married couples, and they can be more easily divided in the event of a breakup.  For example, if a married couple buys a house together but the title is in one spouse’s name, the property is considered community property in Texas and is equally owned by both spouses.  However, for an unmarried couple, the person left off the title may face certain challenges in establishing a right of ownership in the property, especially in the event of a breakup.

Funding College.  A recent study in the Journal of Family Issues found that divorced parents contribute only about a third of what married parents contribute to a child’s education.  However, on the flip side, children of single parents tend to get more federal financial aid for college, since the financial aid formula looks at the income and assets of both married parents or of the custodial unmarried parent.

These are just a few of the benefits of marriage, and this list is by no means exhaustive.   These benefits may also vary depending on a couple’s particular situation, and before relying on this information, you should speak with a professional with expertise in his or her field.

In Texas, adultery is a legally recognized reason for the breakup of a marriage, and it can be a factor in determining custody and the division of assets in a marriage.  However, each court has a different approach to adultery, often depending on the county and the judge’s own views.  For example, some judges may think that any infidelity is wrong under any circumstance, whereas other judges may feel that it is so common that it does not make much of a difference except in extreme situations.

In general, adultery does not affect most divorces to the extent that many people think.  However, most judges will take the adultery and its surrounding circumstances into consideration.  For example, a judge may be interested to hear whether the cheating spouse spent excessive amounts of marital assets on a boyfriend or girlfriend, such as spending a couple’s life savings on an elaborate vacation with the boyfriend or girlfriend.  In such cases, a judge might award a slightly higher percentage of the community assets to the non-cheating spouse.

Another consideration that judges take very seriously is whether any children of the marriage have been affected by the adultery.  For example, if a spouse introduces a boyfriend or girlfriend to the children too soon, thereby confusing the children or putting them in danger, or if a spouse’s parenting ability is affected by the boyfriend or girlfriend, such as when a spouse chooses to spend time going on dates rather than attending the children’s soccer games, then very few judges tolerate such behavior and will rule accordingly.  Therefore, I always caution clients to put their children’s needs ahead of their own, especially during a divorce, and to put off dating until a divorce is finalized.  This can be hard for a client to hear, especially if a divorce takes a long time to complete.

In sum, although adultery can affect a divorce, it is not necessarily the deciding factor on custody or property issues.  There is a broad spectrum of behavior that is tolerated by most courts.  However, every situation is different, and if you find yourself in a divorce involving adultery, you should always consult with a lawyer to determine your rights and remedies.