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Fort Worth, Texas Divorce Law Blog

Dealing with private businesses during a divorce

Dividing marital estates is often a challenging and contentious process in Texas and around the country, and reaching an amicable settlement can be especially difficult when one of the most valuable assets involved is a family-owned business. Determining the value of a private business is rarely a straightforward process, and people who are not involved in day-to-day operations may believe that the companies run by their spouses are worth far more or far less than they actually are.

The value of a privately owned business is determined by assessing its assets, income and markets, and most of the figures needed to perform these calculations can be found in a company's ledgers and other financial records. However, spouses not involved with business operations may be wise to go further to ensure that assets are not being hidden and all income is being reported. This could be done by visiting company facilities, speaking with workers and managers or calling in an expert.

Retirement accounts can take hit in high-asset divorces

Due to the oil industry, Texas has a reputation for having lots of wealthy residents. However, that wealth can mean a downturn in couples' financial positions should they decide to divorce.

Divorced couples have about 30 percent less net worth than those who stay married. Divvying up assets like retirement accounts can cause problems down the road for the account holders because they may not have enough time to rebuild the accounts before they retire. If both parties have roughly the same amount of money in their retirement accounts, they may decide not to touch the accounts.

Gray divorce can wreak havoc on retirement accounts

Divorce among older couples is becoming more common in Texas and across the U.S. In fact, while divorce rates have stabilized for all other age groups, it has doubled over the last few decades for people ages 50 and over. Unfortunately, this phenomenon, known as gray divorce, can wreak havoc on retirement plans if assets are divided up incorrectly.

People over the age of 50 are closer to retirement age. As a result, any financial mistakes made during a divorce can be harder to recover from. Meanwhile, many older couples have several 401(k)s, pensions, IRAs and other investments, making it more difficult to divide everything evenly.

Divorced parents can make co-parenting work

For divorced parents in Texas, co-parenting can often be one of the most difficult, yet rewarding, aspects of adjusting to life after divorce. Individuals who are close to their children may be conscious of trying to avoid making the kids feel as if they need to choose sides between them even when the parents have a contentious relationship with one another. Some people may also feel like they need to compete with one another for their children's love and affection, especially when activities and standards are different between the parents' homes.

Despite the difficulties of co-parenting, many divorced parents find a path to success, sharing child custody or arranging a positive visitation schedule. With attention to scheduling and planning, even parents with a poor interpersonal relationship can work together to create a positive, supportive environment for their children. In many cases, the fathers are more likely to be designated as the noncustodial parent even though joint custody is an increasingly popular option. When parents only have visitation, however, they may want to make the most of the limited time that they have with their children.

Understanding the different ways to deal with child support

During a divorce, many Texas couples also have to negotiate child support. Understanding the different types of child support cases might be helpful. Additionally, parents should keep in mind that during a child's life, the situations surrounding their support might change and that in many instances, that will affect their type of support case.

There are four types of child support cases, and each type addresses a particular situation. Three of the types work within the state's Office of Child Support Enforcement and one refers to private child support agreements. Non-IV-D cases are those in which parents are privately paying and receiving child support. If the non-custodial parent fails to pay support, then the case can be referred to the Office of Child Support Enforcement, in which case it becomes a IV-D case.

Co-parenting tips following a divorce

During or after a divorce in Texas, learning how to co-parent the children can be a difficult process. However, even if the divorce itself was difficult, parents can help make the transition from one family to two easier for their children by learning to work together to co-parent properly.

When sharing the kids, one of the most important things divorcing parents can do is to keep the rules the same for both households. The kids may find the transition easier if they know what to expect in each household, especially if the kids are younger. Further, having an annual calendar that plans where the kids will be on any given day, including holidays, can prevent confusion. It is recommended that this calendar be available in both parents' homes.

What happens to child and spousal support in bankruptcy

Divorced Texas parents cannot discharge child support or alimony in bankruptcy, but they may be able to discharge other elements of the divorce settlement in certain circumstances. Fewer than half of people who are supposed to get child support receive the full amount. The legal system takes failure to pay child support seriously, and it may be punished through garnishing wages, fines and even jail time.

However, with a Chapter 13 bankruptcy, a parent might reorganize child support payments and pay them back over a period of three or five years. During that time, no action can be taken against the parent for the debt. Unlike a Chapter 7 bankruptcy, a Chapter 13 bankruptcy acts as a kind of repayment plan for some creditors.

Pros and cons of sole legal custody

Disputes over child custody can take at least two forms. There are Texas parents who are contesting physical custody, but legal custody can also be contested though, and the fight over that can be the more important one in many cases. A parent with sole legal custody over a child is the only one authorized to make major decisions on the child's behalf. The decisions of this type include religious, healthcare and education choices.

It is possible for the legal custody situation to differ from physical custody in the same case. Indeed, such a setup is somewhat common. Co-parents often share legal custody even if they do not share physical custody. It should be noted that sole legal custody brings with it advantages and disadvantages.

Actor challenges higher child support payments

The drama that people in Texas view on the television show "Grey's Anatomy" bleeds into real life for the actor Jesse Williams. Media reports about his most recent court filings indicate that he intends to challenge his monthly child support payment order of $50,629. His legal petition comes less than a month after a court increased his obligation from $33,242 a month. His legal filings claim that an "error in law" resulted in the increase.

Williams bases his argument on claims that his ex-wife inflates expenses related to the needs of their two children and also pads the amount with her personal expenses. He also wants child support payments to go through a third party so that he is not sending money directly to his ex-wife. He insists that he can fulfill parental obligations by directly paying for school tuition, uninsured medical expenses and miscellaneous bills.

Inherited IRAs could be split in divorce

Texas residents who inherited individual retirement accounts could possibly lose funds when it comes to property division in a divorce. New tax laws, which change the rules for awarding alimony, are silent on this as is the Internal Revenue Service, nor have there been any court rulings. Some people are using inherited IRA funds to offset the lost alimony deduction under the new tax laws.

Property inherited before or during a marriage is generally considered separate property and not subject to property division unless it is commingled with joint property, which could happen if the IRA beneficiary chooses to do this with withdrawn funds. IRAs cannot be jointly held. In an inherited IRA, the decedent's name remains on the account, and the beneficiary's name is added. The beneficiary may not make new contributions to this account, and distribution terms remain the same.