Prenuptial Agreements in California Part 2:  Waivers of Spousal Support

Prenuptial agreements or premarital agreements in California are governed by California’s Uniform Premarital Agreement Act.  This an agreement made by a couple prior to marriage that will automatically be effective upon marriage. This article is Part 2 and focuses on the rules relating to alimony, also known as spousal support.

Do we need to involve attorneys?

Yes, if you want it to be enforceable later.  The rule is that the person against whom enforcement of the spousal support provision is sought must have been represented by independent counsel at the time the agreement containing the provision was signed.

Can we put in any terms we want as long as we agree, and attorneys are involved?

No, when it comes to spousal support, the court will not enforce a provision that is unconscionable even if the person who agreed to that unconscionable provision was represented by independent counsel.   

Is there a waiting period?

Yes, the party waiving spousal support needs to have seven days between the prenup is presented and signed and be advised to seek independent counsel.

How does a court decide what is unconscionable?

The court will look at the assets and earning power of each spouse and may determine that a waiver of spousal support is unconscionable if one spouse has significantly less than the other. Also, if the court determines that it would be unfair to enforce the waiver based on what the person would have received in spousal support if the prenup hadn’t been signed.

What other factors will be considered to invalidate the prenup?

The prenup cannot have been executed under duress, fraud or undue influence.

What are some other things to watch out for?

It is important for the spouse waiving the support to have actual or constructive knowledge of the assets and obligations of the other party or to voluntarily waive such knowledge.  Because of this, if the parties want an enforceable prenup, both need to be full and accurate in their disclosure of assets and debts and should not attempt to lie or trick the other person

If you are looking for a local, Dixon attorney to assist with a divorce or family case, please give us a call.

 

Prenuptial Agreements in California Part 1:  Cans/Cant’s

Prenuptial agreements or premarital agreements in California are governed by California’s Uniform Premarital Agreement Act.  This an agreement made by a couple prior to marriage that will automatically be effective upon marriage. This article will examine what can be accomplished and what is unenforceable in a premarital agreement.

 

Can I punish my spouse financially if he/she cheats?

 

Some couples may want to include a financial punishment for the other spouse who cheats, and this is commonly referred to as an infidelity clause.  California is a no-fault divorce state, so “fault” such as infidelity will not be a relevant consideration to a California court. As such, California courts will not enforce a financial punishment against a spouse for cheating.  

 

Can we negotiate child support or child custody in the prenup?

 

No, a court is going to look at the best interest of the child standard for child support and custody, and visitation rights so a premarital agreement will not be binding with respect to those issues.  

 

What are some topics where a prenup can be helpful?

 

  • Each spouse’s rights to property.  
  • The right to manage or control property, such as buying, selling, using, etc.
  • What is going to happen to property in the event of death, divorce, etc.
  • Spousal support in the event of divorce (special rules apply)

 

Is there an alternative to a prenup?

An irrevocable trust is an estate planning mechanism that can be used to protect property.  A revocable trust permits the grantor to place the assets under the control of a trustee, then who administers the assets for the benefit of beneficiaries named by the grantor.

Unfortunately, an irrevocable trust has a number of disadvantages, so it may not be the right mechanism for you.  The grantor loses ownership of the trust property, so you generally won’t be allowed to change your mind and take the property back.  Additionally, there are taxation issues involved with an irrevocable trust that may not be advantageous. Consult with a Vallejo attorney to see whether an irrevocable trust is right for you.

 

How is a prenup changed?

After marriage, a premarital agreement can be changed only by a written agreement signed by both the parties, so consider carefully the terms you are including.

 

 

Alimony: Federal Tax Code Changes

There’s a change to the tax code that could impact you.  If your divorce is final after December 31, 2018, then alimony will no longer be deductible in your federal taxes if you are the person paying the alimony.  It will no longer be included in your gross income if you are the person receiving alimony.

Where does the new rule come from?

The Tax Cuts and Jobs Act (TCJA), signed into law in 2017 will end the alimony-payer deduction and the payee’s income inclusion for agreements executed in after 2018.

Is there a “grandfather clause”?

Yes, alimony agreements executed on or before December 31, 2018, are grandfathered in.  Also, if you later modify an agreement that was executed prior to December 31, 2018, then you can choose to stay grandfathered in or adopt the new rule.

How is the new rule different than the old rule?

The old rule was that the alimony was tax deductible and the money paid to the spouse was included in income.  The new rule is that the party paying alimony no longer gets the deduction and the person receiving it now doesn’t have to report those amounts as income.

Does this change California State tax?

No, the new rule relates to federal taxation but not state taxes.  Your California state tax rules will remain the same.

What’s the practical effect of this change?

The general impact is that overall more taxes will likely be paid because previously the payor spouse received a tax break through a reduction of their gross income, and the receiving spouse was at a lower income. For each couple, though, the practical impact of this may vary.  There may be other strategies that can be employed that have tax advantages to both parties, so consult with a Fairfield lawyer to find out the best options for your particular circumstances.

 

Dating and Divorce:  Can Dating Impact Your Divorce in California?

If you are in limbo during the sixth month waiting period for a California divorce, you may be wondering if you can start dating again.  This article will discuss the ramifications dating may or may not have on your California divorce.

California is a no fault state, so dating will not impact your ability to get a divorce.

In California, you do not need to prove that one party did something “wrong” in order to file for divorce. Divorces are generally filed for “irreconcilable differences,” so if whether you are dating or not dating during the marriage or separation period is irrelevant to your divorce.

Dating could impact spousal support if you are living with the new boyfriend/girlfriend.

Section 4323 of the Family Code states: Except as otherwise agreed by the parties in writing, there is a rebuttable presumption, affecting the burden of proof, of decreased need for spousal support if the supported party is cohabitating with a nonmarital partner.

This does not mean that living with your new boyfriend/girlfriend will for sure impact the spousal support.  With a rebuttable presumption, you can present evidence to show that your need for spousal support is not reduced by the cohabitation. For example, if you showed that the new partner did not provide any of the money used for the cohabitation, then that may be sufficient to overcome the presumption.  The facts will vary depending on your circumstances, so consult with an attorney about your case, but the point of this section is to make you aware that living with someone new could impact your spousal support so that you can research the issue further.

Dating could impact custody.

The court will be looking at the best interest of the child to determine custody, so the person that you are dating could potentially impact that analysis in many ways:

  • Will the person you are dating be involved in child care?
  • Does the person you are dating have any criminal history?
  • Does the person that you are dating have history with your ex such that your ex may be able to argue that the person is a bad influence on the child?

The choice of whether to begin making friends or romantic connections before your divorce is final is one that faces many couples going through a divorce.  Although dating may not impact your case itself directly, you should certainly consider all the collateral ways in which a new relationship may affect you and make an informed decision about how to incorporate someone new into your life.

 

 

 

5 Steps For Successfully Handling First DUI in California

Did you just get a DUI in California, and you don’t know what to do?  This article will walk you through important information you need to know to navigate the system successfully.

Don’t forget about the Driver’s License Suspension or Revocation

  • After you are arrested for DUI, the officer will forward a copy of the form and your confiscated driver’s license to the DMV. You have just 10 days from your receipt of a suspension or revocation order to request a hearing with the DMV, otherwise your license will be automatically suspended or revoked. It is wise to retain an attorney immediately after a DUI arrest to assist you with fighting your driver’s license suspension or revocation.

Evaluate your finances.

  • Take time to evaluate your finances immediately. You may qualify for a public defender.  If not, you may want to retain private counsel.  Understanding your financial position and seeking help from family or friends if necessary can be advantageous to you in preparing a strong defense.  Additionally, if you decide to accept a plea or are found guilty, you can anticipate paying fines, costs of counseling, future costs of an interlock device and SR-22 insurance when you get your license back.

Look for holes in the case against you.

  • This is extremely broad but of the utmost importance. An attorney can look at each aspect of your situation and see possible defenses. Don’t just assume that your case is lost before really analyzing every piece of what happened.
    • Driving – Is there a question of whether you were the driver? What is the evidence of driving?
    • Stop – What was the basis for the stop?
    • Tests – Were the tests administered properly? Were there environmental, health or other factors at play that could have impacted the results?
    • Time – Is the evidence linked in time to the driving, or were the tests performed significantly after the driving occurred?

Get an idea of whether you want to fight or enter a plea.

  • After you have consulted with an attorney about the viability of your defense, a good idea is to consider what you think your best course of action would be. Consider your employment situation. Look at a calendar. Make a thoughtful analysis to decide how you want to proceed. Some defendants turn over all the decision making power to their attorney, but it is important for you to realize that you are the client and the person in charge.

Never give up and do not look back.

  • Many defendants focus on what they could have done or should have done better in the past to prevent a criminal charge. This is good for helping you avoid criminal charges in the future, but otherwise focusing on the past is not productive. Look to the future. Talk to your attorney about the long term plans and expungement in the future. Plan to comply successfully with all the terms of your probation. Prepare to put the DUI behind you and know that you can have a bright future.

 

 

Why the Separation Date is Important for California Divorce

If you are considering a divorce in California, your separation date is a very important issue.  This article will discuss why that date is significant.

The separation date defines the line between community property and separate property.

  • Community property in general is assets, income, or debts earned or acquired during the marriage.
  • Separate property in general is property owned before the marriage, property inherited or gifted to one part during the marriage, money from the rent or sale of a separate property, money earned while legally or physically separated from the spouse, and items given from one spouse to the other with the intention of designating it as separate property.

Community property is shared by the spouses, separate property belongs to the individual.

  • The separation date is important because the determination of the type of property determines how it is split. Community property is shared by the spouses.  Separate property is for the individual.

How is the date of separation determined by a court?

If the date of separation is unclear or the parties disagree, the court will look at two methods for determining the effective date:

  • Objective test: Here the court will determine when you started living apart from each other. However, in some instances the spouses may be living in the same home but be physically separated within the home if the evidence suggests that the spouses unambiguous conduct indicates an intent to be separated.
  • Subjective test. Here the court will look at your conduct toward each other. At what point did one or both of you think you were done? When did you decide you no longer wanted to be married?

What should you watch out for?

  • The higher earner is typically incentivized to have a date of separation sooner rather than later. It is often in that person’s interest to have an earlier date so that more of the income or assets will be earned after the separation date.

In some cases, the date of separation is agreed upon by the parties, but this article should alert you to concerns and questions that may arise if the date of separation is contested.  Consult with an attorney early in the process of considering a divorce to find out how to navigate the date of separation mostly advantageously to your case.

 

 

 

 

Tips for Working with a Custody Mediator

There are different types of custody mediation.  In one instance the court may order mediation to resolve contested issues.  In other cases, the parties may participate in a private mediation with a retired judge, attorney, etc.  In either case, there are some general rules of thumb that will help you prepare for a successful interaction with the mediator.

  1. Always look through the lens of the best interest of the children.

As you prepare for mediation, remember your focus:  the best interest of the children. Other motives such as your convenience, getting revenge for past wrongs, or being unyielding to send a message will not be well-received by the mediator.  As you consider what you want, always put the child first.

  1. Review important documents.

Brush up on any active orders or other important documents.  In order to focus the discussion on the right issues, it will be helpful for you to remember clearly the decisions that have been made already in the case.

  1. Organize your goals but stay open to other possibilities.

Consider what you want to accomplish in the mediation and focus on the big picture.  Walk in knowing what you would like to accomplish but be open to different solutions on how to achieve what is best for the child.  Try to stay reasonable and keep an open mind, but be organized enough to know what you would like to achieve.

  1. Try to stay logical and calm.

In a mediation, you can speak honestly about your position. Do not feel pressured to agree.  However, staying logical and calm is very important.  Disparaging the other party will only waste time.  Make your position clear and keep your focus on the best interest of the child when you explain that position.

  1. Take your turn to talk when you have the floor, but don’t interrupt others.

Listening is a skill often underestimated by many. Listen carefully to what the mediator is saying. Don’t be so concerned with your argument that you don’t take time to understand other points of view.  Interrupting others is an easy pitfall in a highly emotional situation, but it can put a mediator on the defensive. Listen to what he or she has to say and then respond at the right time, and your arguments will likely be better received and understood.

With the right preparation and attitude, you can have a very successful mediation experience. The bottom line is to always focus on the children and keep yourself professional, articulate and calm.

 

DUI With Injury Basics

If you are convicted of a DUI with injury, you face increased penalties, and you will want to consult with an attorney as soon as possible to discover if there are defenses that can be argued in your case.  This article will educate you on some of the basics, but you will benefit from assistance with the specific facts of your case.

What are the elements of 23153 “DUI with injury”?

  • You were driving under the influence
  • You committed an illegal act or neglected to perform a legal duty
  • Another person was injured as a result

Does my blood content have to be a certain alcohol level?  

No, if as a result of drinking an alcoholic beverage or taking a drug, your mental or physical abilities are so impaired that you are no longer able to drive a vehicle with the caution that a sober person exercising ordinary care would have, then you can still be convicted of a DUI even without a blood alcohol measurement of over .08%.  So your blood content CAN be the basis of the charge, but it’s not the ONLY way you can be charged with DUI.

Is DUI with injury a misdemeanor or a felony?

Prosecutors may charge it as either a misdemeanor or felony depending on the circumstances of the case.

What if I don’t think the injury was my fault?

There are many defenses to show that another person was not injured as a result.  For example, if you were stopped at a light and the other driver rear-ended you, then you could argue that even though you were driving under the influence, the injury wasn’t your fault.

Is there any chance I won’t be convicted?  

Yes, there are many defenses to a DUI with injury.  The prosecutor has the job to prove each element of the crime (see #1 above) beyond reasonable doubt.  An experienced defense attorney can take you through each step of what happened to you and look at ways to suppress the evidence or undermine it.  From the reason for the stop to the tests that were performed to the correlation with the injury that was caused, etc. your case can be examined to discover how to defend your case.

 

California Divorce:  Custody Issues with Teenagers

Do you have a teenager?  If so, you’ll want to know what rules are specific to teens when it comes to custody.  This article will focus specifically on teens and outline some of the rules and considerations that will help you create a smoother experience for your teen in coping with divorce and change.

 

  • Does my teenager have a say in custody?  Typically, yes.

 

Children of any age can address the court, but as per Family Code 3042, children 14 years of age or older specifically can address the court regarding custody and visitation, unless the court determines that it is not in the child’s best interest.  This means that unless there is a special circumstance, your teenager will get to have a voice in the process if he or she so desires.

 

  • Will it matter what my teenager’s preferences are?  Typically, yes.

 

California judges must promote the best interest in the child after considering the factors, which can include the preference of the child.  There is no exact formula as to the weight the child’s preference has in the overall determination. What this means is that your teenager’s choice isn’t necessarily the final answer, but it will likely weigh into the judge’s decision.

 

  • How does the court hear the teen’s preferences?

 

The judge has discretion to talk to the child in open court or in chambers. The parents may be present but they may not.  The judge has a wide latitude in determining how to get the information needed, and as always must take into consideration the best interest of each child.

 

  • What issues should I think through with my teenager and the divorce?

 

Often teens go through a lot of changes at this time of their lives, so you can probably expect some adjustment challenges that may need to overcome.  Does your teenager have a car that will enable the teen to ignore custody plans? Do you and the other parent have similar rules for curfew, financial support of the teen, etc.?  What will be your strategy if your teen’s preferences for custody change over time? A wise parent will think through the potential issues and challenges that may arise with the teen and talk about those issues before they become big problems.

 

  • Can I modify the custody arrangement?  What if my teenagers preferences change?  Yes.

 

Yes, the existing custody order may be modified when there has been a change in circumstances. It may be that the teen’s preference is the change in circumstances, or it may be that other changes are prompting a modification. Again, the court will consider what suits the best interest in the child and will consider all the same factors that were used initially to establish custody. The teen can play a role in voicing opinions for the modification just as the teen’s preferences factored into the original custody determination.

You teenager is going through a lot of changes themselves and in their environment, so a divorce can be an additional stress.  However, your teen is likely also more capable of understanding and processing the divorce process than small children, and the opportunity for your teen to participate in the custody process can be a step in the right direction of helping them navigate the future.

3 Important Tips on How to Divide Your Assets in Divorce

Your attorney can help you with a plan for dividing property and debt, but here are three important steps to help you on the path to a successful division of assets and debts:

  1. Write down all property and all debts.

Making a list is the first step of dividing everything fairly. Here’s a list to get you started thinking through your own finances:

  • Real property – your home, land, investment properties
  • Other property – Furniture, jewelry, cash, technology, automobiles, recreational vehicles
  • Wage earnings
  • Investments – stocks in an individual account, Roth IRA, 401K
  • Health Saving Accounts
  • Pensions
  • Mortgage
  • Student Loans
  • Credit Card Debt
  • Automobile Loan
  • Loans from family members
  1. Label each as community property or separate property
  • Community property – assets, income, or debts earned or acquired during the marriage.
  • Separate property – property owned before the marriage, property inherited or gifted to one part during the marriage, money from the rent or sale of a separate property, money earned while legally or physically separated from the spouse, and items given from one spouse to the other with the intention of designating it as separate property.
  • Common question: What do we do with an asset that can’t be divided physically? For example, do we have to sell the house in order to divide the money?  The answer is that each spouse has to get assets equivalent in value, so in lieu of selling the house, one spouse may keep the house and the other would get the value of half of that asset.
  1. Place a value on each asset and debt.

In preparing for a divorce, it may be helpful to see if you and your spouse have the same estimation of the value of assets and debts or if there is a large disparity. For your list, make an estimate of the value of each item.

  • Be aware that some items may have more value than you realize. For example, a pension plan can be very valuable and special rules apply to pension plans. In this situation, consulting with an attorney on the value and division of the pension plan can be important.