One of the most important elements of a divorce settlement is a fair and equitable division of marital assets. And this is understandably a contentious issue – no one enjoys surrendering property, and it's easy to form emotional attachments to certain objects as well as the hard work that was put in to earn investments such as retirement accounts. These attachments can make it difficult to willingly sign over such objects as part of a divorce settlement.
Split Simple's uncontested divorce process is designed, above all else, to make this division as simple and drama-free as possible. We respect your financial and lifestyle needs, and we will work with both parties to ensure the division of assets set down in your divorce settlement is indeed equitable.
If you live in or around Chicago, Illinois and you want to learn more about how we handle the question of dividing marital assets, please call Split Simple today at 855-665-9920.
It's important to begin the discussion of separating assets by setting concrete foundations for that discussion. In other words, we need to define terms and explain what assets are even eligible for division.
First, it's important to understand that an "equitable division of assets" doesn't mean that the final asset division must be precisely 50/50. That split is something of a broad guideline for a divorce settlement- the asset division should be somewhere in the neighborhood of equal, but there's some leeway. A 51/49 or 52/48 division probably won't raise many eyebrows. However, any significant deviation from this principle will be viewed with skepticism and must be strongly justified.
This process begins with a determination of marital vs. separate property. Illinois law, like divorce laws in most states, recognizes a distinction between marital property and individual, or "separate," property. Put quite broadly, marital property can be divided during a divorce, while each individual spouse is allowed to retain possession of their separate property.
As you can imagine, then, determining what qualifies as marital property is quite important. Split Simple's attorney-mediators have ample experience examining finances and guiding couples fairly through this process.
What qualifies as separate property? There are two factors:
- Any property you acquired before the marriage qualifies as separate, even if you acquired it during the relationship that led to the marriage
- In most cases, property you received as a gift or as part of an inheritance is considered separate property
There's one more provision you should be aware of. Any increase in the value of separate property that occurred during the marriage is usually considered marital property. For example, if you acquired a stamp collection before your marriage that was valued at $1,000, that is considered separate property. However, if the stamp collection rises in value to $5,000 during the marriage, then that $4,000 increase is considered marital property.
For many Americans, their retirement account is one of their most important financial assets- second, perhaps, to their home. The retirement account represents years of investment and hard work. After all, it's supposed to protect you in your post-work years.
It can be an unpleasant surprise to learn that retirement accounts need to be discussed during a divorce, especially since the vast majority of these accounts are held by one spouse and not jointly. However, in many cases, a retirement account qualifies as marital property, meaning it is subject to property division.
It is a popular misconception that retirement accounts must be liquidated at a divorce, resulting in both taxes and a tax penalty. However, your attorney mediator will educate you with regard to your options for retirement account division during divorce.
The option that's right for you will depend on the unique circumstances of your situation, including the nature of your retirement plan (defined benefit plans have different rules than defined contribution plans) and the tax implications of your decisions.
Our attorney-mediators will draft specific language regarding the division of retirement accounts that may later be used in retirement division orders known as QDRO's that actually divide the retirement plan. The QRDO will govern how retirement accounts will be disposed of- this arrangement can be relatively simple (such as one spouse receiving a percentage of the retirement plan at a certain point) or more complex.
Our Chicago attorney mediators will skillfully guide you and your spouse through the many intricate issues associated with the division of retirement accounts at divorce.
Many of our clients are skilled professionals who have worked for a long time and have acquired significant personal assets. When two such professionals get married, the combined value of their estate can be ample.
This is a good thing, of course, but high-value estates do present certain complications in the event of a divorce. The tax implications of divorce for a high-value estate are quite complex, and the sums of money involved make the stakes a little bit higher. In these crucial situations, it is imperative to work with someone you can trust – not just any mediator will suffice. At Split Simple, our thorough and experienced attorney-mediators are committed to a rigorous, data-driven and transparent process.
Fortunately, the principles of divorce mediation still apply. We won't need to fundamentally change any aspect of our process to meet your needs. Our system can help you and your spouse navigate these tricky waters.
Still, the financial complexities of a high-value estate do mean that more time is often required to craft a fair and equitable settlement. It's important that you get this right the first time. This is why we often recommend couples with high-value estates sign up a full package of three, two-hour mediation sessions; you can view our pricing page for full, upfront, transparent information on what this might cost you.
If you're concerned about the effect a divorce might have on your finances, rest assured that Split Simple shares your concerns. We're committed to protecting your financial future. Please call Split Simple today at 855-665-9920.