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Category: Legal Separations And Divorce

Legal Separations And Divorce: Other Effects To Both Parties

Legal Separations And Divorce: Other Effects To Both Parties

A legal separation is the alternative to getting a divorce, especially for people who can’t or don’t want to continue to live together during their marriage. While legal separations are for parties who plan to divorce, they’re also for parties who don’t want to end their marriage, but can’t continue to live together. After petitioning the court to legally recognize their separation, both parties will be able to live apart from one another.

Date of SeparationLegal separations are recognized in many states. The day that a court officially grants a couple their legal separation is known as the Date of Separation. That particular date also marks when the beginning of their divorce process begins, particularly if one party plans to file for divorce as soon as possible.

Even before being granted a legal separation, both parties must be aware of the legal and financial ‘sacrifices’ they might need to make. That’s why it’s important for both parties to understand what’s at stake before they amicably choose to legally separate.

What the ‘Date of Separation’ does to finances

The Date of Separation marks a time where the finances and legal issues of both parties become vulnerable. Credit, mortgage payments and retirement funds mark some of the finances up at stake before a separation is legally recognized. Besides those, other financial matters are up at stake:

Tax returns

The Date of Separation may influence how both parties may file their Federal Tax Returns. Some states declare an individual spouse’s income (after the Date of Separation) their income alone, making it the responsibility of that spouse. Many resources suggest both parties should talk to an accountant about how to handle those finances.

Businesses and other investments

Businesses and other investments undoubtedly face asset division during the divorce process. Since most states take the value of a business and/or asset from the time of the Date of Divorce (rather than the date of separation), it could dramatically impact how much one party may take out of the asset division agreement. In some cases, if the value of any asset appreciates (rises) during the period of separation, both spouses will be granted an equal share of that particular asset during the time of divorce.

Spousal support (alimony)

The Date of Separation also influences how the courts determine alimony or spousal support payments. Depending on the state, courts determine alimony based on the Date of Marriage and separation, the length of the marriage and the working/financial status of both spouses. Most states, particularly for long term marriages, entitle lower-wage earning spouses to some form of spousal support.

Legal Separations And Divorce: The Effects Of The Separation Date

Legal Separations And Divorce: The Effects Of The Separation Date

Far too many people think about the divorce first. In reality, there’s another occasion that marks the ‘beginning of the end’ of a marriage. That occasion is the Date of Separation.

The Date of Separation

The Date of Separation is as it implies: it’s the date where both parties legally separate, more or less beginning the process of divorce (before one party officially files).

The date of separation marks the time where both parties are in legal and financial limbo. From that point, they maintain that legal and financial status until the Date of Divorce arrives. The type of limbo both parties remain in puts them at financial and legal risk of managing their assets, property and debts. Even outside factors affect the financial and legal status of both parties during this period, since (financial) market conditions can cause the value of their assets to potentially depreciate.

What determines the DoS

Date of Separation 2The actual Date of Separation varies between states. Some states define the Date of Separation as the date where one spouse physically relocates from their marital place of residence. Others have a definition describing the Date of Separation as the date where the actual divorce papers are filed in court. The Date of Separation, in other states, is considered the date where one party informs the other they intend to file for divorce.

The variation in the Date of Separation can make determining the actual date tricky. The first definition regards some kind of finality for the divorcing party, while the others still may depict the parties living with each other (for various reasons). Due to that, it’s important for both parties to talk to their individual attorneys about determining the actual Date of Separation for their situation.

The Date of Separation and finances

The Date of Separation has a large effect on finances. In some cases, a lack of DoS can cause a large amount of financial needs to remain unresolved. Therefore, it’s important for both parties to sort out their finances before formally deciding a Date of Separation.

Both mortgage and credit line payments still remain within the responsibility of both parties during a marriage and even after the Date of Separation. That’s why it’s suggested for both parties to agree to close any joint credit lines (and bank accounts) before formally deciding on a date.

Retirement funds aren’t usually divided until the Date of Divorce. The party with the retirement account at risk should obtain a copy of the account’s details and benefits brochure to have a reference