The first consideration in the division of property during a dissolution of marriage is to define what is marital and what is non-marital. Generally, most assets acquired by either party during the marriage with marital earnings, regardless of how the property is titled, will be a marital asset. Most assets owned prior to the marriage or received through inheritance will be a non-marital asset. However, it is rarely that simple. Even some non-marital assets may have a “marital component” that is subject to equitable distribution. This is often the case with real property and small businesses.
Florida is an Equitable Distribution state. This means that marital property will be divided in an equitable or fair manner. Although the Court is required to start with the presumption that there should be an equal division of marital assets, the Court is not required to do so. It is important to have an experienced family law attorney who understands the laws and how to apply them to your particular situation.
In today’s society, it is common for one or both of the spouses to own a small business. Having an appropriate value placed on the business can have a significant impact on the other assets that you may receive. Florida law states that the Court must use “fair market value” for a business. This generally includes what is called “good will” which describes the propensity of customers to return to the business for its reputation, name and other unique qualities. However, Florida law makes a distinction between “personal goodwill” which attaches to a particular person and “enterprise goodwill” which attaches to the business. The Court’s finding between these two types of goodwill can have a huge difference on the value placed on the business. As such, it is important to have an attorney that fully understands the valuation process and financial theories. Mr. Luther’s Bachelor’s degree in Business Finance makes him particularly knowledgeable in this area.
In a divorce action, the Court has the authority to divide retirement accounts such as: 401(k), 403(b), IRA, pensions and other retirement accounts. The division of these accounts is often accomplished with a Qualified Domestic Relations Order (QDRO). This Order allows the Court to transfer retirement accounts from one spouse to the other without incurring any immediate tax liability. Pensions can also be divided in a way that each spouse receives a share of the monthly benefit directly from the pension once the participant begins receiving benefits. Each spouse is then taxed on that spouse’s tax rate when distributions begin. It is extremely important to consider the overall tax considerations when dividing retirement accounts. Mr. Luther’s Business Finance Degree and considerable experience make him uniquely qualified to handle these types of issues.