Tag Archives: division of assets

Who Is Responsible for Marital Debt in an Illinois Divorce?

shutterstock_562619533Many couples fight about finances throughout the course of their marriage. Money issues and especially debt can wreak havoc on a marriage, and in many cases, financial concerns can be a significant factor in the decision to get a divorce. Sometimes, one spouse will rack up huge amounts of credit card debt without the other spouse even knowing. Divorcing couples may wonder what will happen if one or both spouses have incurred a large amount of debt. Illinois divorce laws allow for equitable distribution of marital property, and this includes the division of debts. However, exactly how marital debt is to be divided depends on each situation, since every divorce is unique.

Marital Assets and Debts

Marital debt refers to any debts that a couple accumulates while they are married. These debts may include a mortgage, credit cards, vehicle loans, and student loans. During divorce, marital debts will be divided between the spouses according to Illinois’ equitable distribution laws. Credit cards, even if they are only in one spouse’s name, are still considered marital debt that the court will divide.

The court will review several factors to determine which spouse should be responsible for certain debts. For example, one spouse may have been the primary “breadwinner” of the family, and if they earn a higher salary, they may be better able to pay debts. On the other hand, if one spouse has been a stay-at-home parent for many years, they may have a lower income-earning potential after the divorce, and large amounts of debt could be financially crippling for them.
In general, marital debt is subject to equitable division, just like assets. In order to be as “equitable” as possible, one spouse may take on more of the marital debt, but in return, they may receive more marital assets to make up the difference. However, even if a portion of the debt is assigned to one spouse, they may choose not to make payments on it. Creditors are not legally obligated to follow a judge’s orders in a divorce case, and they may begin the collections process against either spouse. This means one spouse can be held responsible for any jointly held debt, such as a loan or credit card that they co-signed with the other spouse. Interest and penalties may apply to this debt as well. In order to avoid the possibility of one spouse being held responsible for the other’s debts, spouses should ensure that one spouse is removed from any joint accounts.

Taking Responsibility

Ideally, with the help of their respective attorneys or through mediation, divorcing spouses can work out an agreement on how to divide their marital debt. Options may include continuing to share the debt or dividing the debts so each partner takes responsibility for their own debts. In these cases, the spouses will not need to come up with a large sum of money to pay off the debts immediately. However, this can also be somewhat risky, since a person’s credit score may be negatively affected if the other party decides not to or is unable to pay off his or her share of the debts. Ultimately, the best option is to simply pay off any outstanding debts prior to completing the divorce. This method may be challenging, but it provides benefits in the long run by allowing both parties to start their new lives debt-free.

Contact a Wheaton, IL Division of Marital Debt Attorney

Amassing a large amount of debt can weigh heavily on someone, especially during a divorce. In Illinois, marital debt is considered marital property and therefore subject to division. If you are concerned about what will happen to you and your spouse’s debt post-divorce, a knowledgeable DuPage County divorce lawyer at the Andrew Cores Family Law Group will advise you on the best way to reach a positive resolution. To schedule a free consultation, call 630-871-1002 today.

Sources:

http://www.ilga.gov/legislation/ilcs/fulltext.asp?DocName=075000050K503

How Is Marital Property Divided in Complex Divorces in Illinois?

Wheaton complex lawyer property divisionDivorces can be complicated, even if both spouses agree on many of the issues that must be addressed. In some cases, the marital estate may include significant assets, or spouses may earn large incomes. In these complex divorce cases, couples may need to address high-value assets or property, business valuation, spousal maintenance, and more. The division of property can have a long-term impact on one or both spouses, so this area needs to be addressed carefully. If you are entering the divorce process, it is important to understand your rights and the near-term and long-term impact of the decisions you make.

Marital Assets

The marital estate includes any property that was obtained during the course of your marriage. Illinois is an equitable distribution state, which means that marital property will be divided equitably, but not necessarily equally. In some cases, litigation in court may be necessary to resolve disputes over the division of assets; however, it is often more beneficial if spouses can work together to reach an agreement on these issues outside of court.

High-value assets often include many different types of monetary funds or possessions, such as the following:

  • Retirement plans

  • Real estate

  • Investments, including stocks and bonds

  • Executive bonuses

  • Trusts

  • Checking or savings accounts

Retirement plans may include 401(k)s, IRAs, or pension benefits. The amount contributed or earned by the retirement plan during the marriage is considered a marital asset and thus must be divided between spouses. In Illinois, a Qualified Domestic Relations Order (QDRO) is typically used to divide retirement accounts between divorcing spouses, and this allows funds to be withdrawn or transferred while avoiding the need to pay penalties or taxes. However, a QDRO is not needed for IRAs, and retirement plans governed by the Illinois Pension Code require a Qualified Illinois Domestic Relations Order (QILDRO).

If a couple owns a business together, this can further complicate matters. Determining the value of the business is essential to ensure a fair distribution of assets. In order to protect family businesses and professional practices, it is important to consider the options for dividing business assets while keeping a business intact. Spouses should also be aware of the tax consequences involved in dividing these assets to ensure that they are prepared for financial success after the divorce has been completed.

Another issue that can arise in a complex divorce case is the possibility that a spouse is attempting to hide assets to avoid dividing them with their former partner. The penalties for hiding assets during divorce can range from a settlement that awards a much greater amount of the marital assets to the other spouse to the offending spouse being held in contempt of court and facing criminal charges for fraud or perjury.

Contact a DuPage County Complex Divorce Attorney

Divorce proceedings can be complicated for any couple. However, the divorce process is likely to be even more complex when a lot of different types of assets are involved, especially those with a high value. At the Andrew Cores Family Law Group, our attorneys are experienced in negotiating and resolving many different types of divorces disputes, including those involving marital property. Regardless of your individual situation, we can help you reach a fair settlement and ensure that your financial interests are protected. To schedule a free consultation, call a knowledgeable Wheaton high asset divorce lawyer today at 630-871-1002.

Sources:

https://19thcircuitcourt.state.il.us/2130/Dissolution-of-MarriageDivorce

http://www.ilga.gov/legislation/ilcs/ilcs5.asp?ActID=2086&ChapterID=59

 

How Do Mothers’ Rights Impact an Illinois Divorce?

Wheaton divorce attorneyIn recent years, a lot of emphasis has been placed on fathers’ rights during and after a divorce. This is partly due to a trend in which many dads have taken more active roles in parenting compared to fathers in previous generations. In divorces that took place in the past, mothers were typically awarded what was called “sole custody” of the children, as well as alimony, child support, the marital home, and other assets. However, things often turn out differently in today’s divorces, since many mothers and fathers share in earning household income and raising children.

In modern divorce cases, mothers’ rights regarding child custody should not be automatically assumed like they often were in the past. During divorce, both parents should be sure to understand their rights and the ways they can reach a favorable outcome.

Protecting the Best Interests of the Child

In Illinois, the court is instructed to consider what is in the best interests of the child when it comes to the “allocation of parental responsibilities” (formerly known as child custody) and “parenting time” (formerly known as visitation). According to Illinois law, if married parents reside in the state, then a family court will decide on these matters as a part of their divorce proceedings. For an unmarried couple, paternity must be established before a court can address matters of parental responsibility and parenting time.

Many factors play a part in deciding parental rights. While the court will not necessarily address which parent is “better” or “worse,” it will consider how the decisions made will affect the child’s well-being. Some of these factors a judge will consider when determining what is in a child’s best interests include:

  • The wishes of the child’s parents regarding who will have parental responsibilities

  • The wishes of the child

  • The child’s relationship with parents, siblings, and other relatives

  • The child’s adjustment to their home, school, and community

  • The mental and physical health of all family members who are involved in the child’s life

  • The occurrence or threat of physical violence against the child by either parent

  • Any domestic abuse against the child or others in the household

  • The willingness of each parent to promote a continuing relationship between the child and the other parent

  • Whether either parent is a sex offender

Mothers play pivotal roles in the nurturing and development of their children. Therefore, they should have equal rights and a say in the outcome of a divorce, especially when it comes to future parenting.

Contact a Wheaton Family Law Attorney

There are many aspects to consider during a divorce, and decisions about parenting time and the allocation of parental responsibilities are often some of the most important issues to resolve. If you are a mother who is concerned about your rights as a divorcee, the compassionate legal team at Andrew Cores Family Law Group will explain your rights and work with you to reach a positive outcome to your case. Call a compassionate DuPage County divorce lawyer at 630-871-1002 to schedule a free consultation.

Source:

http://www.ilga.gov/legislation/ilcs/ilcs5.asp?ActID=2086&ChapterID=59