Our Divorce Mediation Blog - Westfield Mediation, LLC

Divorce Mediation for Small Business owners

9/23/2022

Many of our divorce mediation clients at Westfield Mediation, LLC are small business owners or self-employed. Oftentimes, the business finances of these clients are intermingled with their personal finances. While this may make things a little tricky, it should not be seen as an obstacle to moving forward.

For example, these clients may have some credit cards or bank accounts that they use for work and some for home expenses. Or they may have used their family home as collateral for the business. So, when they are getting divorced, it takes a little time to figure out the value of their business and how to divide it, as well as what assets and debts go with the business and what belong to the family.

While it may seem overwhelming at first to make these distinctions, in divorce mediation, we break the process down into small manageable steps. We try to ensure that everyone is being open and transparent about their accounts. In some cases, mediation clients want to use an accountant who specializes in business valuations to provide an objective analysis of their business, and we provide them with a list of local specialists.

According the Courts, the division of assets and debts in divorce must be fair and equitable. We use this same standard when working in divorce mediation with small business owners or self-employed clients.

For more information about divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M. Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC, at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com

Divorce in the Current Economy

5/20/2022

The ups and downs of the current economy are making some couples contemplating divorce a little nervous. Divorce mediation involves dividing assets and debts, calculating child support and alimony and generally making financial plans for a new future. There will always be some level of financial uncertainty when taking steps toward divorce, but it should not keep you from moving forward. In divorce mediation at Westfield Mediation, LLC, we take current economic issues into account while helping to guide you toward a fair and equitable agreement.

Over the last few months, the stock market has been down, reducing the value of some retirement assets. These changes should not adversely impact the divorce mediation process. In mediation, we mostly focus on how we are dividing the assets rather than the account totals, so we can still move ahead with your plans.

Similarly, we can work around the uptick in the housing market. For many, the value of their marital home has increased in recent months, providing a bonus to divorcing couples seeking to sell or refinance their marital home, while making it harder in some cases to find a new place to live. These are also issues that can be addressed in mediation, while we make plans for your short-term and long-term financial futures.

Finally, the job market is also in flux, with minimum wages rising and employers offering various forms of work ranging from in-office to hybrid to fully remote. For many employees this has been a time of opportunity, while others are feeling stretched thin. These employment issues may impact the discussions involving child support and alimony in divorce mediation, but do not hinder your ability to move ahead.

Economic uncertainty is always going to exist in some form. The important thing is to address these concerns in divorce mediation and work together to factor them into your agreement. Finding solutions that work for both partners in mediation will allow you to move forward to a better, less stressful future.

For more information about divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M.Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com.

Moving Out During Divorce

1/28/2022

Generally, during the divorce process, at least one person moves out of the shared home. Sometimes both spouses agree to sell the house and move; and sometimes one stays while the other relocates. The upheaval that comes with changing one’s living space can be stressful at the best of times. These days with Covid concerns, there are also additional factors to consider including the tight real estate market and the fact that so many people are working from home. In divorce mediation, we anticipate these stressors, and help couples develop flexible, practical plans for going forward with their lives.

At Westfield Mediation, LLC, a neutral mediator helps each couple work together on a plan for moving on. The spouse who is leaving needs a new home, possibly one that can serve as an at-home office and accommodate the children during his/her parenting time. If one person is staying and one leaving, we sometimes devise a plan for the parties to continue to own the home together for a designated period of time – e.g., a set number of years or perhaps until the kids finish high school. In addition, we make arrangements for getting the person who is leaving their share of the equity in the home so that they have the resources they need to find a new place to live.

We often counsel people that their first new home after leaving the marital residence may just be an interim stop. They may need some time for their schedules and finances to stabilize. At that point, they will be better situated to find a more suitable choice for the long-term. Indeed, this need for an interim housing plan may be even more common now when there are fewer homes available for rent or sale in some markets. For many people, recognizing in mediation that their first home post-divorce is not necessarily their last makes the move feel much less overwhelming.

For more information about housing plans or other aspects of divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M. Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com.

Divorce and Social Security

10/22/2021

With the rise of divorce among older married couples -- so-called “gray divorce”-- some couples going through divorce mediation have questions about Social Security income and how it factors into their financial agreement. Divorcing clients that are close to retirement age are wise to consider the options for this income stream as part of their financial futures.

At Westfield Mediation, LLC , we always explain to our clients that the rules regarding Social Security are complicated and often changing, so it is best to consult with the Social Security Administration and/or an elder law attorney before making any binding decisions.

Generally speaking, based on current rules, ex-spouses may elect to receive one-half of the amount of their ex-spouse’s Social Security instead of an amount based on their own work history, as long as the parties had been married for at least ten years. The claiming ex-spouse must be at least 62 years old and not remarried. In addition, the benefit the claiming ex-spouse would receive based on his/her ex-spouse’s work history must be more than the amount that the claiming ex-spouse would receive from his/her own work history. The earliest ex-spouses could claim these benefits is age 62, and the latest is at age 70 years. (Clients over a certain age may be entitled to receive their ex-spouse’s benefit at age 62 and their own benefit at age 70). It is important to note that claims by ex-spouses do not reduce the amount of the earner’s own Social Security benefit.

To figure out when would be the best time to claim these benefits, divorced clients must consider their personal financial circumstances and health conditions. In divorce mediation, we discuss the options with our clients once they have had an opportunity to learn about the specific possibilities available to them by gathering information from outside resources. By addressing these important income issues in mediation, we reduce our clients’ stress and better prepare them for the days ahead.

For more information about financial agreements and divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M. Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC, at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com

College, Covid, and Costs

5/14/2021

In New Jersey, including provisions for paying for the kids’ college has become a standard part of the parenting plan in divorce mediation agreements. Adding the realities of Covid 19 and the recent changes to the financial aid rules to the mix have made the decision-making process a little more complicated.

In our state, the courts have long viewed post-high school education as a necessity for which parents are at least partially responsible. Therefore, it should be part of every New Jerseyan’s parenting plan in their divorce agreement. As tempting as it may be, ignoring this issue now will not make the obligation to contribute to your kids’ education just go away. In fact, if you do not address college as part of your divorce agreement, you risk the Court later imposing its own plan on your family based on your children’s needs and goals and both parents’ resources. So, if you say nothing in your divorce agreement, you may end up paying more later than the plan you could develop now during the divorce process.

Over the past year and a half, the pandemic has made the process of selecting a college more challenging. In many cases, because of travel restrictions, students have had to choose where to attend based solely on virtual tours and information. Many school programs have been remote and/or hybrid, meaning students had to pay for school, yet live elsewhere. Now some schools are requiring vaccinations prior to entry, while others are offering financial incentives to those who vaccinate. Divorcing parents need to work together with their children through this potentially fraught decision-making process.

In addition, recently revised rules on the financial aid process have changed the way income and support are applied in financial aid applications. Moreover, the rules on student loan forgiveness are also in flux.

As part of the divorce mediation process, at Westfield Mediation, LLC, we help divorcing couples come up with a plan for choosing and paying for college for their kids regardless of how old their kids are now. We talk about all the relevant factors – programs, costs, decision-making, college savings plans and applying for financial aid. When needed, we can provide referrals to college financial aid advisors who can help parents complete their children’s forms in a way that maximizes college support packages.

Of course, when your kids are young, it can be hard to predict your children’s future educational needs and wants. Still, we have found that having a basic framework in place helps avoid big arguments and litigation expenses down the road.

For more information about parenting plans and divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M. Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com.

The American Rescue Plan Act and Child Support

3/19/2021

Even in the divorce mediation world, everyone is talking about the new law just passed by Congress – the American Rescue Plan Act of 2021 (ARP). It promises new and increased cash payments to many Americans. One part of the law includes more generous tax credits for children; and this new payment structure may have an impact on child support for divorced and divorcing parents.

Previously, depending on their income, parents received a tax credit of up to $2,000 per child. Under the ARP, this potential tax credit increases to $3,000 per child and $3,600 for children under 6 starting in 2021. In addition, the IRS plans to estimate the amount of the child tax credits for the year for families and pay them out in monthly portions in advance beginning in July 2021. These increased tax credits may impact child support calculations going forward.

Calculating child support is part of the divorce mediation process at Westfield Mediation, LLC. We calculate child support based on income and the number of nights each parent spends with the children, while also taking into account the payments parents make for health insurance premiums and/or child care. As part of the child support calculation, we determine which parent will be claiming the children as dependents for tax purposes. Sometimes, parents share these tax credits or alternate them over time. For our clients, we often run these numbers a few different ways to help them decide what is the best plan for them.

Divorced and divorcing parents may need to consult with their accountants to understand the impact of the new ARP laws on their taxes. In divorce mediation, we advise our clients to seek out the most up to date information available to help them make the best financial decisions for their family.

For more information on divorce mediation, parenting plans and child support, please contact Randi M. Albert, JD, or Michelle Weinberg, M. Ed. Licensed Marriage and Family Therapist, at Westfield Mediation, LLC, at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com

TAXES AND DIVORCE- NOT A DIY PROJECT

3/5/2021

Many people use TurboTax or a do-it-yourself approach to doing their yearly taxes. This works out fine and people are happy with the results and continue this method year after year. But this system does not always work as well the year of your divorce. There are unique tax circumstances you need to consider the actual year you are getting divorced and longer-term tax consequences as a result of your divorce agreement.

There are specific tax-related issues to consider about your divorce and you can address all of them during the divorce mediation process. Who is claiming the children for tax purposes? This may have an impact on your tax bill. Should the lower earner always claim the kids? Alternate years? It may also have a small effect on the monthly child support amounts. And the timing of your divorce can affect your tax bill. If it is close to the end of the calendar year then you may want to wait until the following year to actually get divorced. It may not matter to you much if your divorce is finalized in late December or early January, but it does to your state and federal government and the subsequent tax bill.

While the divorce mediators at Westfield Mediation, LLC, are not accountants or tax experts, they are knowledgeable enough to know that these professionals should be a part of your divorce team before signing a final divorce agreement. The mediators have a list of mediation friendly tax experts in the area to pass along to our clients and always recommend that you have a tax expert review your agreement. For example, when allocating various retirement accounts in a divorce settlement, it is important to distinguish the difference between one account that has pre-tax money and will have taxes taken out during distribution and another account that has post-tax money contribution and will not have taxes taken out when it is time for distribution. At the time of your divorce the accounts may have equivalent values so you think you are dividing things equally, like you intended. But when you retire, one of you has a lot less money because Uncle Sam takes a chunk and the other still has the full value of the account that you thought it had.

These are things that the turbo tax program will not tell you, but a mediator will. It is ultimately up to you, with input from your tax expert, to make these decisions. However, the mediator can help you figure out what these tax issues may be and work with you to reach educated, informed decisions about your taxes now and for the future.

For more information on divorce and divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M.Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com.

Learning More about Your Family Finances Before Divorce Saves Time and Money

10/16/2020

As divorce mediators, at Westfield Mediation, LLC, we have seen that in many families, married couples are reluctant to discuss money issues. Sometimes one person handles all the financial decisions, pays the taxes and the bills. In other homes, the spouses keep most of their expenses and accounts separate, and don’t really share information about their assets and liabilities.

Recently, the coronavirus has created shifts of income and expenses in many homes, inspiring articles about how both spouses need to learn more about their finances in case one partner gets sick and can’t work or pay the bills. We have found that these same concepts about the importance of shared financial knowledge apply to divorcing families as well. Moreover, for divorcing couples, sharing information eliminates any suspicion of hidden assets or debts which reduces stress and helps you work together to create a fair agreement.

In divorce mediation, we help divorcing couples make sense of their financial picture. As part of that process, we go through their financial statements together to create a workable equitable plan. In divorce mediation, we tell our clients that it’s important to know a few basic things about your financial situation before you get divorced.

First, where are the important documents? You should both have log-in information for all savings, investment, and retirement accounts. You will both need to know what is out there to make a fair division of your accounts and debts. Secondly, whose name is on the accounts, the mortgage, the car title, etc. Who is the beneficiary of all your investments and life insurance policies? In our experience, starting with some simple fact-gathering upfront makes the process much easier and productive for everyone, saving time and money, and minimizing arguments down the road.

For more information about financial plans in divorce mediation or post-divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M. Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com.

divorce and Unemployment

9/18/2020

Recently, a lot of the people who have been calling us at Westfield Mediation, LLC, to find out more about divorce mediation have found themselves newly unemployed, furloughed, laid off, or in-between jobs.

This is not surprising. First, the coronavirus virus has wreaked havoc on the economy, and many people have lost their jobs or had their hours cut substantially. In addition, dealing with financial hardships often make existing relationships much more tense and difficult, prompting couples to look into the possibility of divorce. Since divorce mediation provides a low-cost efficient alternative to expensive time-consuming divorce litigation, it’s no wonder that many married and divorced couples having financial stresses would seek us out.

In divorce mediation, we work with clients to create or revise a parenting and financial agreement that works for them. We are able to craft flexible plans for parenting schedules, child support and alimony that can be adjusted over time without returning to court.

Sometimes, our clients’ current financial situation is worse than usual and does not well represent their potential earnings, or their financial history together. In these cases, we can work with them to create economic terms that work for now, and that can be modified if and when their circumstances change, as the economy slowly improves. Having a workable plan in place is key to reducing everyone’s stress during the current hard times.

For more information about divorce mediation or post-divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M. Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com.

Paying for College

2/7/2020

When divorcing clients come to mediation to work out a parenting plan, they are often surprised that the agreement for paying for their children’s expenses extends all the way through college.

In New Jersey, the courts have long viewed post high school education as a necessity for which parents are at least partially responsible. Therefore, it needs to be part of every divorcing couple’s parenting plan. As tempting as it may be, ignoring this issue now will not make the obligation to contribute to your kids’ education go away. In fact, if you do not address college as part of your divorce agreement, the court may later impose its own plan based on your children’s needs and goals and both parents’ resources.

As part of the divorce mediation process, at Westfield Mediation, LLC, we help divorcing couples come up with a plan for paying for college for their kids regardless of how old their kids are now. We talk about all the relevant factors -- costs, decision-making, college savings plans and applying for financial aid. Of course, it is hard to predict your children’s future educational needs and wants. Still, we have found that having a basic framework in place helps avoid big arguments and litigation expenses down the road.

For more information about parenting plans and divorce mediation, please contact Randi M. Albert, JD, or Michelle Weinberg, M. Ed., Licensed Marriage and Family Therapist, at Westfield Mediation, LLC at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at info@westfieldnjmediation.com.

Authors

Michelle Weinberg, M.Ed.,LMFT, is a Licensed Marriage and Family Therapist with many years of experience working with couples.

Randi M. Albert, JD, is an attorney with experience in family law and public service.

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