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IL divorce lawyerWhen two people marry, they join their lives as well as their finances. A huge part of the divorce process is reversing this financial entanglement. Spouses will need to either decide how to divide their jointly held assets or have the court divide assets for them. This process can become very complicated, especially when spouses have complex or high-value assets.

Out-of-Court Property Division Settlements

Ideally, divorcing spouses can work out a property division agreement on their own. Out-of-court settlements can save divorcing spouses time, frustration, and money. There are several alternative resolution methods that may help spouses reach an agreement on the division of debts and assets. Mediation is a process during which spouses meet with a mediator who helps them discuss unresolved divorce issues and develop a solution that works for both parties. Collaborative law is a process during which the spouses and their attorneys work collaboratively to reach a divorce settlement.

Property Division Decided by the Court

Some spouses are unable to reach a property division settlement through alternative resolution methods or other means. In this case, the court will divide marital property based on a legal doctrine called “equitable distribution.” The couple’s shared property will be divided fairly based on many different factors, including:

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Naperville Marital Property Divorce LawyerPeople often assume that the emotional and personal aspects of their divorce will be the hardest issues to deal with. However, many are surprised to learn just how complicated the financial and logistical parts of the divorce are. The division of marital property can be particularly complex – especially if the spouses have high incomes or own complex assets. If you are planning to divorce in Illinois, you may have questions about what property belongs to you, what belongs to your spouse, and what property is contained in the marital estate.

Marital and Non-Marital Property

Per Illinois law, assets and income that a spouse earns while he or she is married is marital property contained within the marital estate. There are a few exceptions to this rule, including inheritance and gifts. Property that a spouse owned before getting married is separate property and belongs solely to that individual during divorce.

However, as with many legal issues during divorce, differentiating between marital and non-marital property is not always this simple. Numerous factors can complicate property division, including:

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DuPage County Divorce AttorneyDuring the divorce process, spouses will need to address multiple types of financial issues. Many of these issues will be related to the division of marital property, in which spouses must determine how all of the assets and debts they acquired during their marriage will be allocated. While dividing some types of property may be a straightforward process, a variety of complex considerations may arise when addressing assets such as retirement savings and benefits. A qualified domestic relations order (QDRO) may need to be created to ensure that these assets are divided properly, and an experienced family law attorney can make sure this type of order is created and executed correctly.

Benefits of Using a QDRO

Spouses will often save money in retirement accounts, including 401(k) accounts provided through an employer or individual retirement accounts (IRAs). Depending on the decisions made during the property division process, the funds in an account may be divided between the parties. However, if the proper procedures are not followed, withdrawing funds from an account before the account holder reaches the age of retirement can result in penalties, and taxes may also apply to these withdrawals.

Early withdrawal penalties and taxes can be avoided through the use of a QDRO, which is a court order that instructs the administrator of a retirement plan to distribute funds to someone other than the account holder. A QDRO may state that a specific dollar amount or a percentage of the funds in an account should be withdrawn and transferred to the account holder’s ex-spouse. In addition to allowing funds to be transferred without incurring penalties, taxes will not apply if the recipient rolls the funds over into a retirement account in their own name.

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DuPage County divorce attorney debt division

When you get a divorce in Illinois, there are various things that must be taken care of before you can finalize the divorce. One of the issues that can have a huge impact on your life is the property division process. Many couples have some form of disagreement about property issues, but most are so busy arguing over their assets that they forget that they must also determine what they will do with their debts. Even though it may not be the most fun topic to talk about, all of your marital debts will also have to be included in your property settlement. The easiest way to deal with debt during divorce is to not have debt at all, but that is not feasible for many couples. Most couples will end up bringing some form of debt to the divorce that will need to be allocated.

Classifying Debt During Your Divorce

One of the first things you do when you begin the asset division process is to gather all of your information pertaining to your finances. Knowing the type of debt you have that needs to be divided will help you determine how it will be handled. Secured debt is any debt that you have that has physical property attached to it. For example, the most common types of secured debt that couples have are mortgages and auto loans. If one of you wants to keep either the vehicle or the house, you will have to refinance the debt under that spouse’s name. On the other hand, unsecured debt is debt that is not attached to a specific piece of physical property. The most common type of unsecured debt is credit card debt. Credit card debt can be easily transferred between accounts, so the balance or part of a balance on a credit card can usually be transferred to a new account in only one spouse’s name.

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Will County divorce attorney property division

If you are like the majority of people, divorce is the absolute last thing on your mind when you are standing at the altar, ready to say, “I do.” Unfortunately, statistics show that a fair amount of marriages still do end in divorces. According to data from the National Survey of Family Growth, an estimated 22 percent of first marriages will experience divorce or separation within the first five years of the marriage. That chance increases the longer you are married, with an estimated 53 percent of first marriages ending in divorce or separation within 20 years of marriage. A divorce involves many areas of your life, with one of the biggest aspects being finances. Often, an area of contention between spouses is how property will be divided, which is why it is recommended that you consult with an Illinois property division attorney to ensure you know your rights.

Marital and Nonmarital Property

Before anything is determined or allocated, the first distinction that will be made about your property is which of it is actually subject to division. Unlike other states, Illinois is not a community property state, but rather functions on the idea of an equitable division of assets when it comes time to divorce. As such, the state makes a distinction between nonmarital property, which is not subject to division, and marital property, which is subject to division.

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