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Protecting Your Business Assets in a Divorce

Decades of hard work can go into the creation of a successful business and when a divorce puts your assets at risk, it can create a significant threat to your livelihood. Even if a company was founded before a marriage, your spouse may have legal grounds to claim that your business should be counted as community property. California’s laws regarding the division of property state that each spouse must receive an equal share of marital assets. If you do not take legal preparations, your business could take a substantial hit. Below, our blog outlines several strategies that you can use to safeguard your business interests in the event of a divorce.

  • Prenuptial and postnuptial agreements: If your business was created before a marriage, protect it by naming it as separate property in a prenuptial agreement. Similarly, you can protect a business that was created after a marriage through the use of a postnuptial agreement. “Postnups” have the greatest chance of success when written well before a divorce is ever on the horizon. These agreements can state early on what portion of a business if any a spouse may be able to claim upon divorce.
  • Give up other assets: The laws in California dictate that the total value of assets received by divorcing spouses must be equal. As the owner of a company, you may be able to retain control of your business if your spouse receives equal compensation through other assets. You may consider sacrificing your claim to any sizable investment, retirement, or insurance accounts in exchange for your business assets.
  • Separate business and personal finances: While assets that were acquired or created before a marriage are typically considered separate property, investing marital assets into an otherwise separate business, which is regarded as commingling assets, can cause complications. separate business (this is called co-mingling assets) can introduce complications. For example, if a business owner were to use shared income to purchase company supplies, a spouse can claim that part of the business has undergone transmutation by becoming community property. Maintaining complete and accurate records of all business-related transactions can help to substantiate your claims in the courtroom.

Help for Business Owners Working through Divorce

When it comes to protecting your business interests in a divorce, it pays to take legal action as soon as possible. If you are currently working through or anticipating the end of a marriage, do not waste any time in contacting Holstrom, Block & Parke, APLC.

Our Southern California divorce attorneys have substantial experience representing clients in high-asset divorce and understand the unique problems you may face as a business owner.

Call (855) 939-9111 and schedule a free phone consultation to get more than 300 years of collective experience in your corner.

After Divorce / Divorce / Money, Property & Support

Holstrom, Block & Parke, APLC Opens New Riverside Office

Holstrom, Block & Parke, APLC is proud to announce the opening of our new office in Riverside! As of October 15th, 2016, our firm’s newest location can be found at 3780 12th St., Riverside, CA 92501. Located on the corner of Market Street and 12th Street, our new office is just across the street from the Riverside Family Law Courthouse and a short block away from the Riverside Hall of Justice.

The expansion provides a unique opportunity for our firm to bolster its reach and effectiveness while also providing the added convenience of being located closer to our clients in the heart of Downtown Riverside. Our firm’s team of family law attorneys pride ourselves on providing individualized advocacy to all who come to us for assistance, and our new location will allow us to continue offering the premier-quality representation for which we are known.

Parties interested in seeking legal representation can continue to reach our office at (855) 939-9111 or by filling out an online contact form today. With more than 300 years of combined family law experience and nine Certified Family Law Specialists within our ranks, our knowledgeable advocates can help you get through your family dispute as smoothly and as quickly as possible.

Community / News

Is Child Support Mandatory with Minor Children?

When a family goes through a divorce, parents have a legal duty to ensure that the needs of their children continue to be met. To this end, child support payments exist to ensure that a divorce does not severely limit the resources available for a child’s care. While parents often have strong opinions about what is in the best interest of their family, the terms of child support are ultimately set and decided upon by the court. In California, detailed guidelines exist for determining support payments and the state calculates payment amounts through the use of formulas. Once all the variables are accounted for, a judge typically orders child support to be paid following the guideline amount.

Factors which can influence the terms of child support often include:

  • Total income of both parents
  • The expendable income of each parent
  • The projected cost of the child’s needs
  • The amount of time each parent will have with a child
  • Support payment obligations from other relationships

Every divorce will contain unique factors and it is understandable that the guidelines for child support will not be best in every situation. It is possible to request a change in the amount of child support that a court determines to be in order. Preference is not an adequate motive for a change in support and spouses must provide a good reason as to why a judge should approve the request. However, even in situations where payments are set to $0, the legal obligation for child support is never waived. In these situations, a parent can revisit the issue and request that the original guideline amounts are set in place.

How Long Do Child Support Payments Last?

Child support payments will typically last for as long as a child is a minor, however, there are certain exceptions to this rule. For example, support can be lengthened if a child has special needs, is living at home while in high school (up to the age of 19), or both parents agree that an extension is in the child’s best interest. The period of support can also be reduced in situations where a child becomes self-sufficient such as when they join the military, get married, or become legally emancipated. To modify an order once it is in place, a parent must be able to show that a substantial change in circumstance has occurred.

Attorneys Helping Families with Child Custody Disputes

The process of determining child support is one that all divorcing parents must go through. While guidelines exist to help determine the nature of child support payments, you may have to fight for what is truly in the best interests of your children and your family. If you are currently experiencing a dispute over the terms of child support, contact Holstrom, Block & Parke, APLC and get the help you need. Our Southern California divorce lawyers can bring more than two centuries of collective legal experience to your case.

Call (855) 939-9111 and discuss your case with an attorney in a free phone consultation.

Child Support

Assets Before Marriage: How Divorce Impacts Them

California is one of only a few states that considers marital property to be communal, meaning it belongs equally to each spouse, regardless as to how the item, asset, or property was actually obtained. You could pay 100% for an item while you are married and half of its value would still technically belong to your spouse. This community property rule for property division is the groundwork for heated disputes in a lot of divorces in the state.

But what about property that you acquired before you were married? Do you have to split that up, too, if you and your spouse call it quits?

Separate Property Rules in California

Separate property is any sort of property – cash, control of businesses, real estate property, material goods, etc. – that you had acquired before marriage. It is called “separate” because it does not get included in community property should you ever divorce. Certain pieces of inheritances or gifts made directly to you in particular can also be considered separate property, even if you are married at the time you obtain them.

You cannot simply assume that your separate property has stayed that way throughout your marriage, however. If your spouse frequently benefitted from a piece of separate property, or if they took reasonable effort to improve upon a piece of separate property, it could become community property. For example, if you owned your home before you got married but then your spouse helped you with renovations that increased its sell-value, they would probably be given a 50% share of that home’s value in your divorce. As another example, if you were given a lump sum of cash in inheritance and used it to fund your spouse’s college education, the money has become community property because it benefitted them and contributed to their lifestyle significantly.

In the end, it is always the safer choice to consult with a Southern California divorce attorney before you get too involved with property division. Without the guidance of a professional lawyer, you could accidentally give up items that are not communal, or illegitimately attempt to hold onto items that actually are not separate. Feel free to contact Holstrom, Block & Parke, APLC to speak to our team about your case and options today.

Property Division

Specific Divorce Concerns for Couples with High Net Worth

A divorce is never easy and although each couple will go through similar processes, no two cases are ever the same. This can be especially true for couples who have experienced extraordinary financial success. Spouses who command sizable incomes often have complex financial situations which can complicate issues such as child custody, alimony, and concerns of privacy. Below, we look at several issues which require special consideration for spouses working through a high net worth divorce.

Issues in a high asset divorce can include:

  1. Business interests: A common situation involves couples with shared interests in a local or family-run business. The accurate evaluation of a company can be complex and often requires the services of a specialist such as a forensic accountant. Financial disclosure and the discovery of assets can include the careful review of tax returns, employee compensation structures, and each spouse’s specific role within the organization.
  2. Real estate holdings: While spouses will generally have a primary family residence, they may also own vacation homes and condos for their children. A location may carry great sentimental value for one or more spouses and the division of real estate can quickly become convoluted. Additionally, issues of post-divorce residence can be influenced by what is in the best interest of the children. For example, some locations may be more practical for school and work than others.
  3. Spousal support: Spousal support, or alimony, can come into play when one spouse is financially dependent on the other for maintaining their standard of living. While alimony may not be a factor when both partners earn relatively similar incomes, it can be a central point of discussion when one party earns substantially more than their partner. When determining appropriate compensation, a court may consider factors such as the length of a marriage, the earning potential of each spouse, levels of education, and the overall health of each partner.
  4. Privacy: It is understandable that divorcing spouses do not want their private family life to be on public display and concerns of privacy can require considerable attention. Spouses are often active members within their communities and information which is revealed during a divorce can irrevocably affect personal and business relationships alike. Securing legal representation with an eye towards discretion can make a considerable difference in the outcome of a divorce.
  5. Child support: Just as a court will generally base decisions on what is in the best interest of a child, parents too want to see that funds for the continuation of their child’s activities are well established. Parents may need to take into account expenses such as private school tuition, the services of a live-in nanny, and study abroad program fees.

Questions About High-Asset Divorce? Call (855) 939-9111

At Holstrom, Block & Parke, APLC, we understand the social and economic issues specific to high-net worth divorce and can help our clients to overcome the hurdles which lie ahead. If your marriage has begun to break down, contact our firm and put more than two centuries of collective experience in family law to work for you. Speak with our Orange County high asset divorce attorneys today and get your questions answered in an initial free phone consultation.

High Net Worth

Are You Holding a Grudge after your divorce?

Holding on to anger, resentment or bitterness toward your ex is only hurting yourself. We all know that deep down, but letting go of our feelings is easier said than done. You’ve been dwelling upon that grudge against your ex that’s buried deep within you for many years. Or maybe you feel like you have moved on. How can you be sure?

Author Rosalind Sedacca recently outlined three ways we can determine if we’re holding on to a grudge:

  1. Passive-aggressive behavior: You tell yourself you’re “over it” so your actions are subtle, yet you’re always finding ways to slightly “get back at” your ex. We all know what passive-aggressive looks like, but can we admit when we’re acting that way?
  2. Sarcastic remarks: Do you find yourself constantly being sarcastic around your ex? Is it to a much higher level than when you’re around other people?
  3. Being short: If you’re constantly “being short” with your ex, you’re coming across as annoyed or intolerant. You clearly don’t enjoy being around that person and you’re still upset at what happened in the past.

Ask yourself if these actions ring a bell. If you’re acting this way around your ex regularly, you’re probably still holding a grudge. And you know as well as we do that once the divorce is over, your grudge is only hurting yourself… not you ex. Let it go.

After Divorce

Child Support and Taxes

An attorney to help understand the tax implications of your child support order.

Taxes can be reduced by allowed deductions and exemptions. Deductions reduce the amount of taxable income, and exemptions reduce the adjusted gross income, such as standard withholding or dependency exemptions. If you pay child support or receive it, the Internal Revenue Service (IRS) has a strict set of rules in place to control the deductions and exemptions that you are allowed because of the payment or receipt of child support. Often, the terms of your divorce decree and related agreements will control the extent to which any tax offsets are available. For that reason, it is very important to consult an experienced Family Law attorney at Holstrom, Block & Parke in Corona, California, regarding the tax implications of the child support arrangements reached in your case.

Child Support: A Nontaxable Event

Child support payments are not taxable. That means the parent making the payments cannot deduct them from income and their receipt is tax free to the parent who gets the payments on behalf of their children. To meet the definition of child support payments, the payments must be so designated in a divorce or separation agreement. “Family support” payments will be treated like alimony and taxed as income to the recipient unless the agreement under which they are paid specifically designates a portion or amount as child support.

Child Support and Dependency

Even though the payment and receipt of child support does not create a tax event in and of itself, there is an important tax consequence related to child support payments: who gets to claim the children as dependents in order to receive the dependency exemption?

The IRS says that you must provide more than half of a person’s total support in a calendar year to claim an exemption based upon dependency. In order to resolve dependency questions about the payment of child support, the IRS has created a special rule that controls the circumstances of how and when the payment of support creates an exemption. The rule applies when:

  • The parents are divorced or legally separated under a decree of divorce or separate maintenance, separated under a written separation agreement or living apart at all times during the last 6 months of the calendar year
  • One or both parents provide more than half the child’s total support for the year
  • One or both parents have custody of the child for more than half the calendar year

The rules do not apply if support is determined under a multiple support agreement or the child’s parents were never married.

The special rule states that the parent who has custody the greater part of the year is the custodial parent and that parent will be treated as the person who has provided more than half of the child’s support. Unless the parties otherwise agree, the custodial parent will be entitled to claim the tax exemption for the child if the other dependency criteria are met. The actual number of days the child spends with a parent will determine the definition of custodial parent where custody is split or where legal proceedings make custody status unclear during any tax year.

The rule allows the non-custodial parent to be treated as the parent who has provided more than half of the child’s support for dependency purposes if the parties agree to that. In order to claim the exemption, the non-custodial parent must have either:

  • A written declaration signed by the custodial parent stating that he or she will not claim the child as a dependent
  • A signed decree or agreement executed after 1984 that states the custodial parent will not claim the exemption for the tax year and the non-custodial parent attached the appropriate documentation to his or her return
  • A signed decree or agreement executed before 1985 that provides for the non-custodial parent to claim the exemption along with a statement that at least $600 was in fact given in support to the child, unless there is a modification to the pre-1985 agreement that says that provision doesn’t apply

Non-custodial parents must attach the appropriate agreement or written declaration to their taxes. The written declaration must be made in a format that follows a particular form.

Talk to a Lawyer

Tax issues concerning support payments and dependency status can be complex. An attorney experienced in these areas can be an invaluable asset. Contact Holstrom, Block & Parke in Corona, California, for more information today.

DISCLAIMER: This site and any information contained herein are intended for informational purposes only and should not be construed as legal advice. Seek competent legal counsel for advice on any legal matter.

Child Support

Child Support For Special Needs Children

Divorce is an emotional experience for both parties. The challenges become even greater when the parents have a child with special needs.

Is a special needs child entitled to receive extra child support? What are the best interests of the child?

It is the right of every child to have high-quality, safe and nurturing child care because all child have special needs. However, some children, because of physical or learning disabilities, may require extra support in the child care setting.

Both parents have a legal obligation to support their children until they reach the age of majority or finish high school – under most, but not all circumstances. Issues surrounding financial support can be complicated and will be taken into consideration when determining how long the non-custodial parent must make payments.

When your child has special needs, the amount of child support may be higher and last longer than for a child without special needs; support payments may be required until the child reaches adulthood.

When your child turns to adulthood, the court determines whether or not he or she is disabled for support purposes. If the individual is unable to fully support him or herself due to a physical or mental disability, the non-custodial parent may be ordered to continue payments.

It is important to realize that unlike other child support orders, when there is a special needs child involved, child support for that child may not be terminated when the child reaches 18.

If you are the parent of a special needs child and have questions regarding his or her child support payments, seek the help of an experienced family law & divorce attorney to best guide you in the process and answer any doubts as well as help you ensure what is in the best interest of your child.

Contact the family law offices of Holstrom, Block & Parke. The OC Attorneys to discuss your concerns about your special needs child, and guide you through the child support/ child custody process.

After Divorce / Child Support

Custody Of Special Needs Children

What If My Child Has Special Needs?

Going through a child custody fight is a battle in and of itself. That battle is only intensified when the child has physical impairments, cognitive deficits or other challenges. A special needs child may require additional financial support, and meeting the child’s various needs can be a significant burden for parents.

There are many issues with a special needs child that are just not a factor in a typical custody battle. Access to any special medical care or child care resources must be taken into consideration, as well as the functionality of the child. Another point that will need to be considered is time. Managing a child with special needs can be very demanding and will require more time and resources from parents. The court will need to weigh all of these issues before determining custody.

Our Riverside Family Law attorneys at Holstrom, Block & Parke are experienced with child custody matters involving special needs children. Whether you are the primary caregiver looking for help to meet your child’s needs, or the non-custodial parent trying to avoid overwhelming child support, we can help. Call us at (855) 747-6225 or send us an email.

What Are The Challenges Of Custody With A Special Needs Child?

There are several unique challenges that apply to a custody matter involving a special needs child. Each child’s special needs deserve special consideration when developing a parenting plan that is in that child’s best interests. While legal custody relates to a child’s education, healthcare, and decisions of that nature; a more detailed plan must be formed in order to account for any special education or services needed by your child.

Joint physical custody may be difficult for special needs children who thrive on routine. Picking them up and changing their environment every few days or weeks can sometimes do more damage than good. Many times, the parent who is not granted physical custody can be hit will extreme child support payments, since raising a child with special needs generally involves more costs than raising a “typical” child.

Our attorneys are familiar with all these issues. We can help make sure that all your child’s needs are met after divorce, from quality time with both parents, to making sure that financial needs are met. Call our Riverside office today at (855) 747-6225 or send us an email online.

Child Custody / Divorce

Divorce Finance: Staying Ahead of The Game

If you’re like Amy Koko, author of Ex Wife New Life, the end of your divorce may have caused some serious financial confusion. There are attorneys who, unfortunately, don’t assist their clients and prepare them for their financial future properly.

If that’s you, do you remember what it was like trying to adjust your life to your new financial situation? (We know some people don’t need to adjust at all, but that isn’t always the case.) You may have had to cut back on your groceries, your gym membership, clothes for your children, etc. It can be a serious challenge that you may not have been prepared for.

Koko states that for women (or men) living on alimony, there are two things they’ll need to understand. The obvious is the financial planning element: knowing your situation and adjusting your spending accordingly. The other less obvious barrier is coming to terms with the fact that you still financially depend on someone you’re no longer married to and probably don’t love anymore.

All financial plans and settlements are different, and it’s important to have a firm understanding of your finances as they are currently and as they’ll be in the future. Divorce is confusing enough, and you don’t need money to be another form of confusion.

Remember: alimony is taxable! Some women, like Amy Koko, find this out the hard way. If your ex was doing your taxes throughout the marriage, it might be quite overwhelming to try to tackle them yourself now that you’re divorced or separated. We usually recommend working with a financial advisor at least the first year on your own to make sure you’re on track.

Koko also provides an interesting outlook on being financially dependent as a divorcee. She states that if a company employed you and financially and you were dependent upon that company for 30 years, you’d have no problem leaving with a great financial package (i.e.- retirement). That’s how you can look at alimony: you earned it.

Divorce / Financial Help

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