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The fiduciary duty of each party involved in the dissolution of a marriage requires full disclosure of documents and information that are pertinent to their case without being requested. This obligation includes the distinct nature and valuation of all assets and debts in which the community has or could have an interest or for which…
DetailsThe standard used by the courts in California to determine spousal support payment amounts is designated by the California Family Law Code as Marital Standard of Living (MSOL). Marital Standard of Living is considered by the courts to be a general description of the financial place in life the parties achieved as of their date…
DetailsEstablishing the value of a life insurance policy can be one of the more muddled issues to deal with when determining property division. Although there are several types of life insurance policies, not all forms give rise to property division issues. Generally, there are two categories of life insurance you need to consider— whole life…
DetailsIn the State of California, retirement benefits are considered a form of employment compensation. Thus, the community estate owns the pension rights that pertain to employment during the marriage. This holds true regardless whether the pension benefits have vested or matured. The division of pension benefits between the separate and community estates must be “reasonable…
DetailsOne of the most significant challenges attorneys usually face in divorce cases concerns issues related to the family home. Should your client buy out the other party? Should your client allow the other party to buy out the home? Would it be better if the parties sell the home and split the proceeds? Or, perhaps…
DetailsIn California, marital standard of living is usually determined by the actual income and expenditures of both parties. However, in some cases, calculations may turn out exceptionally high because both parties lived beyond their means or one of the individuals continually worked excessive hours. When it is clear that the couple lived above its means,…
DetailsIn case you are not aware, during July 2011, the Internal Revenue Service issued Notice 2011-70, which made a significant change to stipulations for individuals looking for spousal relief under IRC 6015(f). This notice may help you protect your clients from liability for either underpayment or nonpayment of taxes caused by dishonesty by their spouses. …
DetailsThe California Supreme Court defines earning capacity as “the income the spouse is reasonably capable of earning based upon the spouse’s age, health, education, marketable skills, employment history and the availability of employment opportunities.” Marriageof Simpson, (1992) C.4th 225, 14 Cal. Rptr. 2d 411. Due in part to the current economy, there exists a notable…
DetailsIn 1979, the landmark California Supreme Court case, “In Re Marriage of Epstein,” established guidelines for reimbursements of separate property payments (normally from post-separation earnings) on community property debt. As a customary rule, courts may reimburse a spouse if that spouse used post-separation earnings or other separate funds subsequent to separation to pay for pre-existing…
DetailsOver the previous four issues of Forensic Accounting Today, I have provided an overview of how law practices account for revenue and expenses, and introduced the background of an actual case study concerning income reporting. In this issue, I am providing the final portion of the case study. If you would like to review part…
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