We are open for business and offering phone and video consultations during business hours.

Free Initial Consultations

Phone630-580-6373
With offices in Naperville, Joliet, Wheaton, Plainfield & Chicago
Livas Law Group

wheaton divorce lawyerIn large part, getting a divorce is a financial transaction that requires the couple to fairly divide their marital assets and debts. This can include everything from the marital home and the associated mortgage, to bank accounts, retirement savings, vehicles, and household items. However, one of the most contentious subjects for many couples is how to handle credit card debt. If your marriage and finances are currently struggling, here are some things you should consider.

Credit Card Debt is a Common Cause of Divorce

A recent study shows that divorce is up to 30 percent more likely for married couples who argue about finances, and credit card debt is a common focus of such arguments. Unlike a mortgage, credit card debt can accumulate due to a spouse’s irresponsible spending habits, sometimes before the other spouse even realizes what is happening. This can contribute to mistrust and resentment that ultimately leads to irreconcilable differences. If you hope to have a chance of saving your marriage, working together to manage your debt may be your best option.

Most Credit Card Debt Will Need to Be Divided

If you do proceed with a divorce, you should know that in most cases, all credit card debt incurred by either spouse during the marriage will be part of the division of marital property. This includes debt from joint credit card accounts, as well as debt from individual accounts in each spouse’s name. You may be able to prepare for your divorce by paying off as much debt as possible ahead of time. For any debt remaining, you will likely either need to fairly divide it between you and your spouse, or offset it through the distribution of assets. In either case, you should try to update your accounts to prevent a situation in which both spouses are still liable to creditors.

...

Wheaton divorce lawyerIn an Illinois divorce, all property and assets belonging to the marital estate must be distributed fairly between the two spouses. However, certain assets known as non-marital property are not included in the division. If you are preparing for a divorce, it is important to review your finances to identify any non-marital property that you can protect. However, the process of protecting your non-marital assets can begin even before your marriage.

Strategies for Protecting Non-Marital Property

Under Illinois law, non-marital property includes property that was owned by either spouse before the marriage, as well as property acquired by either spouse during the marriage through a gift or inheritance. However, even property of this nature can become a factor in the division of assets if you are not careful to keep it separate from the marital estate. Here are some strategies for protecting your non-marital assets both before and during your marriage:

  1. Create a prenuptial or postnuptial agreement. If you have substantial assets before getting married, you can ask your future spouse to work with you to create a prenup that specifies the assets that will remain non-marital property. You can also create a postnuptial agreement during the marriage that accomplishes the same purpose.

    ...

DuPage County divorce attorneysWhen a couple gets divorced in Illinois, all of their financial assets will need to be considered in order to determine a fair distribution of marital property. Many people are aware that this includes properties like the marital home, vehicles, and joint bank accounts, but it also includes some assets that you may not expect, like businesses and individual retirement accounts. One of the most complicated kinds of assets that may need to be divided in a divorce is a settlement or verdict from a civil lawsuit.

Dividing Personal Injury Settlements and Other Lawsuit Awards

Illinois law differentiates between non-marital property that belongs to one spouse alone and marital property to which both spouses have a right and which must be divided in a divorce. Assets acquired before the marriage or after a judgment of legal separation are typically considered to be non-marital property, while most assets acquired during the marriage are considered to be marital property. These criteria can apply to lawsuit awards in the same way that they do for many other types of assets.

One common example of a lawsuit award that can complicate the divorce process is a personal injury settlement or verdict. These cases often involve injuries to just one spouse, so the logical assumption may be that compensation for damages would belong solely to the person who was injured. However, a 1980 Illinois Supreme Court judgment clarified that an injury settlement or award granted during the marriage can be considered marital property because it compensates for medical expenses and lost wages that affect the whole family. That said, because Illinois requires an equitable distribution of marital assets rather than an equal split, a court may determine that the injured spouse should be granted a larger share of the award during the divorce.

...

Wheaton divorce attorneysThe recent passing of the American Rescue Plan Act, including another round of COVID-19 economic impact stimulus payments, has been welcome news for many families who have struggled financially throughout the pandemic. However, if you have been through a divorce in the past year, especially if you have filed taxes jointly with your former spouse, obtaining your share of the stimulus may be more difficult than expected. Understanding your eligibility for the stimulus, as well as how it is distributed, can help you ensure that you receive the funds to which you are entitled.

Who is Eligible for the 2021 Stimulus Payments?

The most recent round of stimulus payments provides up to $1,400 for each U.S. citizen or lawful resident who qualifies based on their adjusted gross income. Individuals qualify for the full amount if their annual income is $75,000 or below, or $112,500 or below if they file as head of household. Married couples who file taxes jointly qualify for $2,800 ($1,400 per spouse) if their adjusted gross income is $150,000 or below. Eligible individuals and couples will also receive $1,400 for each qualified dependent. Individuals and married couples with annual incomes above these thresholds may qualify for reduced stimulus payments, though payments phase out completely at an individual income of $80,000, a head of household income of $120,000, and a married couple income of $160,000.

How Are Stimulus Payments Disbursed to Divorced Couples?

Most stimulus payments for this round are distributed using information provided when filing either a 2019 or 2020 tax return. If you are recently divorced and you filed your taxes individually for both of these years, your stimulus payment should be sent to you, likely as either a direct deposit to your bank account or a check sent in the mail. However, if you filed taxes jointly with your former spouse in 2019 and/or 2020, it is possible that the full amount of the stimulus will be delivered to the spouse who still has access to the bank account that is set up for direct deposit, or who still lives at the address on file with the IRS.

...

DuPage County divorce attorneysUnlike some other states, Illinois does not require divorcing couples to divide marital property in half between them. However, it does require them to divide assets equitably to prevent either party from facing excessive hardship, and in order to do so, it is important to know how much the marital property is worth. Valuing property can be one of the most complicated parts of the divorce process, but with the help of an experienced attorney and financial professionals, you can better ensure an outcome that protects your interests.

The Process of Valuing Marital Property

Before beginning the process of valuing marital assets, it is important to determine which properties are considered to belong to the marital estate, and which are considered individual, non-marital property. In general, non-marital property is that which was acquired by either spouse before the marriage, whereas marital property is that which was acquired by either spouse during the marriage, except through an inheritance, gift, or a few other exceptions. In some cases, however, non-marital property may have been combined or commingled with marital property in a way that makes it difficult to isolate during a divorce. It is usually a good idea to work with a personal accountant or another financial professional to help you distinguish marital and non-marital property.

Once you have a better idea of which properties are considered marital, it is then important to determine how much each of them is worth. Some assets, like bank accounts, retirement accounts, and stock investments, have a relatively straightforward value, but it is important to establish a date at which the value is determined for division purposes, since it may fluctuate over time. You may be able to agree upon a date with your spouse, or the court may make the decision.

...
Back to Top