Financial Checklist for Divorce
Preparing for a Texas Divorce: Assets
Going through a Divorce is painful no matter what the circumstances. Before you get into the Texas Divorce Process, reduce expense, stress and conflict by making sure you are financially prepared. Planning ahead helps you in making sound decisions, start preparing for post-divorce life, and avoid many post-divorce pitfalls. Below is a list of items you need to gather before counseling with an attorney. Financial Documents are a must to show what your true assets and liabilities are in the marriage.
Documents:
- Tax Returns (at least three years) or Tax Liens and all IRS related documents
- Wills and Trusts with all attachments reflecting corpus and trust holdings
- Listing of all liabilities (including mortgages, credit card debt, personal loans, automobile loans, etc.):
- Name of entity, address and telephone number
- Account number
- Amount owed
- Monthly payment
- Property securing payment (if any)
- Most current statements and account status of lenders
- A Listing of all Real Property, address and location, including (includes time-shares and vacation properties):
- Deeds of Trust
- Notes including equity loans and second liens
- Legal Descriptions
- Mortgage Companies and Loan Servicers (Name, Address, Telephone Number, Account Number, Balance of Note, Monthly Payments)
- Current fair market value
- Appraisals
- Motor Vehicles (including mobile homes, boats, trailers, motorcycles, recreational vehicles; exclude company owned):
- Year
- Make
- Model
- Value
- Name on title
- VIN Number
- Fair Market Value
- Name of creditor (if any), address and telephone
- Persons listed on debt
- Account number
- Balance of any loan and monthly payment
- Net Equity in vehicle
- Cash and accounts with financial institutions (checking, savings, commercial bank accounts, credit union funds, IRA’s, CD’s, 401K’s, pension plans and any other form of retirement accounts):
- Name of institution, address and telephone number
- Amount in institution on date of marriage
- Amount in institution currently
- Account Number
- Names on Account
- Company loans and documents related to benefits
- A listing of separate property (property owned prior to marriage, family heir looms, property gifted, inherited property):
- Records that trace your separate property. These assets will remain yours if properly documented
- Retirement Benefits:
- Exact name of plan
- Address of plan administrator
- Employer
- Employee
- Starting date of contributions
- Amount currently in account
- Balance of any loan against plan
- Documents
- Publicly traded stock, bonds and other securities (include securities not in a brokerage, mutual fund, or retirement account):
- Number of shares
- Type of securities
- Certificate numbers
- In possession of
- Name of exchange which listed
- Pledged as collateral?
- Date acquired
- Tax basis
- Current market value
- If stock (date option granted, number of shares and value per share)
- Stock options plans and related documents
- Insurance and Annuities Policies and Inventory:
- Name of insurance company
- Policy Number
- Insured
- Type of insurance (whole/term/universal)
- Amount of monthly premiums
- Date of Issue
- Face amount
- Cash surrender value
- Current surrender value
- Designated beneficiary
- Other policies and amendments
- Closely held business interests:
- Name of business
- Address
- Type of business
- % of ownership
- Number of shares owned if applicable
- Value of shares
- Balance of accounts receivables
- Cash flow reports
- Balance of liabilities
- List of company assets
- Possible hobbies or side businesses that generate income
- Mineral Interests (include any property in which you own the mineral estate, separate and apart from the surface estate, such as oil and gas leases; also include royalty interests, work interests, and producing and non-producing oil and gas wells:
- Name of mineral interest
- Type of interest
- County of location
- Legal description
- Name of producer/operator
- Current market value
- needs leases or production documents related to the asset
- Money owed by spouse (including any expected federal or state income tax refund but not including receivables connected with any business)
- Household furniture, furnishings and Fixtures
- photos
- purchase documents
- Electronics and computers including software and hard drive
- Antiques, artwork and collectibles (including works of art, paintings, tapestry, rugs, crystal, coin or stamp collections) Other large collections need to be appraised! (Guns, quilts, action figures, books)
- Miscellaneous sporting goods and firearms
- Jewelry including appraisals
- Animals and livestock
- Farming equipment
- Club Memberships
- Safe deposit box items
- Burial plots including documents of ownership
- Items in any storage facility
- Travel Awards Benefits (including frequent flyer miles)
What About Texas Spousal Support Laws ?
In September 1, 2011, Texas House Bill 901 ( Texas HB 901 ) revised the spousal maintenance law in the Texas Family Code effective for divorce cases filed on or after September 1, 2011. The bill revised the conditions that establish eligibility for spousal maintenance, commonly referred to as alimony, and changes the factors required to be considered by a court in determining the nature, amount, duration, and manner of periodic payments for a spouse who is eligible to receive maintenance.
Eligibility for spousal maintenance still requires that the spouse seeking maintenance lacks sufficient property to provide for the spouse’s minimum reasonable needs.
The law provides potentially increased relief to spouses who have been out of the work force, are disabled, are victims of family violence or are the primary custodians of a disabled child.
Some of the major items in the Texas Spousal Support Law are:
1. The maximum amount of spousal support that courts may award increased from $2,500 to $5,000.00 per month, although it is still limited to 20 percent of the payer’s average gross monthly income.
2. The duration of spousal support in Texas is a maximum of 5, 7 or 10 years, generally depending on the length of the marriage.
3. The law clarifies if a person has primary care for a disabled child, the custodial parent may be prevented because of the child’s disability from earning sufficient income to meet the custodial parent’s minimum reasonable needs.
4. The law also clarifies a person may not be held in contempt for failing to pay spousal support which is in an agreed order and extends beyond the period of time provided under the law.
In order to receive “maintenance,” (which is the statutory term for spousal support), the spouse seeking support must lack sufficient property to provide for the spouse’s “minimum reasonable needs”, AND one of the following:
(1) The recipient must be unable to earn sufficient income to provide for his or her minimum reasonable needs because of an incapacitating mental or physical disability;
(2) The marriage lasted for 10 years or longer and the recipient lacks the ability to earn sufficient income to provide for his or her minimum reasonable needs;
(3) The recipient is the custodian of a child of the marriage of any age who requires substantial care and personal supervision because of a physical or mental disability that prevents the spouse from earning sufficient income to provide for the spouse’s minimum reasonable needs; OR
(4) The person ordered to pay support was convicted of or received deferred jurisdiction for an act of family violence during the pendency of the suit or within two years of the date the suit is filed.
The court can order maintenance to continue for:
(1) 5 years if the parties were married less than 10 years and the maintenance is awarded due to family violence;
(2) 5 years if the parties were married more than 10 years, but less than 20 years.
(3) 7 years if the parties were married more than 20 years, but less than 30 years;
(4) 10 years if the parties were married for more than 30 years.
In cases where the maintenance is awarded due to the mental or physical disability of the spouse or a child of the marriage, the court may order that the maintenance continue as long as the disability continues.
However, in all circumstances, the law provides that the Court shall order maintenance for the shortest reasonable period that allows the recipient to earn sufficient income to meet his or her reasonable needs.
What about Termination?
a. The obligation to pay future maintenance terminates on the death of either party or on the remarriage of the oblige.
b. After a hearing, the court shall order the termination of the maintenance obligation if the court finds that the obligee cohabits with another person with whom the obligee has a dating or romantic relationship in a permanent place of abode on a continuing basis.
c. Termination of the maintenance obligation does not terminate the obligation to pay any maintenance that accrued before the date of termination, whether as a result of death or remarriage
If you are contemplating dissolving your marriage and have questions concerning your financial future, seek competent legal counsel to help you determine whether you could be eligible for spousal support the provisions of the law.
Out of Wedlock Children and Texas Fathers Rights
The Brookings Institute states that 41% of all births in 2012 were to unwed mothers! What are a father’s rights over his children? With dropping marriage rates and increasing non-married couples living together, the percentage of children being born out of wedlock is growing yearly. How are the fathers of these children treated? In most states, the mother of a child has 100% of the custody rights until the paternity of the father is legally established. How does a Texas father legally establish paternity when the mother of their child refuses to allow him to sign the birth certificate and tells him that he will never have any type of communication or relationship with his child?
In today’s fast pace world there are many situations where a woman may selfishly just want a child with no strings attached, including a dad! Welcome to the internet dating world! Many professional men are contacting us concerning an internet dating contact, a short relationship, and pregnancy. The father then is told he will not be allowed in the child’s life and if he tries, serious legal problems will be encountered or he will face serious and costly legal road blocks pursued by the mother!
Practicing attorneys in Texas who defend Interstate Jurisdiction cases help many fathers who live in other states while the mother and child reside in Texas.
What are a father’s rights in the State of Texas? Any and every right a parent may have is available to a father who seeks them.
What should a father, living out of state, with a child living in Texas, do to establish his paternity and legally enforce his father’s rights? He should consult an attorney ASAP who can help him obtain and preserve his paternity rights with his child. Once the judge issues a finding of paternity, the father has all the rights of any other father such as custody, decision making, conservator rights, and visitation rights.
How does the father file for paternity of the child in Texas?
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Paternity Registry (Family Code 160.401-2)
A man who desires to be notified of a proceeding for the adoption of or the termination of parental rights regarding a child that he may have fathered may register with the registry of paternity:
Before the birth of the child or no later than the 31st day after the date of the birth of the child
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Alternate means to Establish Paternity (Family Code 160.301-2 and 160.402, 160.601)
The mother of a child and a man claiming to be the biological father of the child may sign an acknowledgment of paternity with the intent to establish the man’s paternity. An acknowledgment of the paternity must:
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Be in a record
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Be signed or otherwise authenticated by the mother And the Man seeking to establish paternity
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State that the child whose paternity is being acknowledged:
1. Does not have a presumed father or has a presumed father whose full name is stated
2. Does not have another acknowledged or adjudicated father
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State whether there has been genetic testing and that the acknowledging man’s claim of paternity is consistent with the results of the testing
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State that the signatories understand that the acknowledgment is the equivalent of a judicial adjudication of the paternity of the child and that a challenge to the acknowledgment is permitted only under limited circumstances and is barred after 4 year.
A man is entitled to notice of a proceeding regardless of whether he registers with the registry of paternity if:
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A father-child relationship between the man and the child has been established under this chapter or another law.
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The man commences a proceeding to adjudicate his paternity before the court has terminated his parental rights.
The parentage of a child may be adjudicated in a civil proceeding by voluntary litigation.
A Father should be proactive and enforce his rights promptly to enhance his probability of fair and equal treatment that is binding under the law!
Shared Parenting With Texas Child Possession Orders
If only divorced parents could mutually agree on meaningful possession schedules while co-parenting their kids! But since many cannot or will not, the Texas Courts generally use a One-Size-Fits-All Standard Possession order for all children over three years of age. The Texas Legislature over time has expanded the schedule to make access a little more flexible. Does this always squarely meet or suit the needs of a child and her/his relationship with both parents?
The Section 153.001 of the Texas Family Code is the State’s policy on possession schedules and its formation:
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Assure that children will have frequent and continuing contact with parents who have shown the ability to act in the best interests of their child;
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Provide a safe, stable, and nonviolent environment for the child;
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Encourage parents to share in the rights and duties of raising their child after the parents have separated or dissolved the marriage.
The Texas Family Code, section 153.002 also states that “the best interest of the child shall always be the primary consideration of the court in determining the issues of conservatorship, possession of, and access of the child”. Because of this the Texas Courts are given wide range in determining a child’s best interest in possession schedules.
What about fair and equal Parent Possession Schedules? This is easier desired than accomplished! In E. Mavis Hetherington’s book, For Better or for Worse, Three types of co-parenting relationships are identified:
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Conflicted: Parents have frequent conflict, communicate badly, and have difficulty disengaging emotionally from the marriage (20-25%)
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Parallel: Parents who emotionally disengage from each other, with little communication and who usually do not coordinate child-related issues between themselves although conflict is minimal. (Over 50%)
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Cooperative: Parents who work together to actively plan their children’s lives and support each other. They work toward conflict free possession schedules in a nurturing parenting situation. (25%-30%)
Despite many separation and divorce related conflicts among parents, the main beneficial recipients of shared parenting are the children. When both parents are positively engaged in the parent-child relationship, probabilities are much higher for positive adjustment, better academic achievement and positive mental development of a child.
In Johnston & Campbell’s book, Impasses of Divorce, their findings support that the majority of parents substantially reduce their pre marital conflict within 2-3 years after divorce. Regrettably, 8%-20% of parents remain in a state of chronic high conflict!
How can Parents promote or enhance shared parenting in possession schedules?
Many parents will usually find a way or the mechanism to eventually work together for the benefit of the child, no matter how contentious the divorce. Even if shared parenting is not possible, parallel co-parenting reducing conflict may be acceptable. But if the parental conflict is high, try to use and enforce a possession schedule that limits parent contact during possession exchanges of the child and accordingly reduce conflict opportunity.
Parents: Leave your conflicts at home. You are divorced! Concentrate on what is best for your child. You are the lifetime primary example for your child on how families communicate. Be mature and responsible and show your child that no matter what has occurred in the past, and regardless of fault, your joint goal is an emotionally healthy child over the long haul.
