Fullerton Family Law Blog

California residents should expect for their tax returns to be scrutinized by the Internal Revenue Service if they claim a dependent who is also claimed by another filer. This can occur in situations in which separated or divorced parents both want to get dependent-related tax credits.

Parents who claim their children as dependents can potentially file as Head of Household. They may also be able to claim certain beneficial tax credits, including the Child and Dependent Care Tax Credit, Earned Income Tax Credit and Child Tax Credit.

These days, divorces among people over age 50 in California are not uncommon. Although older adults might be beyond concerns about how the end of a marriage affects young children, financial issues require extra attention. Retirement savings will likely be divided between departing spouses, which could delay plans of retiring.

Coming to terms with a former spouse about the division of retirement assets frequently creates conflict. To arrive at a fair agreement, a person should work with a financial planner to determine a post-divorce budget for basic living expenses and a new retirement savings strategy. Catch-up contributions allowed for people over age 50 could allow someone to rebuild savings after a divorce. The Internal Revenue Service grants older adults the ability to place an additional $6,000 into an employer-based retirement savings plan or individual retirement account.

Most couples in California don't actually "plan" for a divorce. Even so, there are times when marital problems become so great that untying the knot becomes an option. The first thing couples are encouraged to do when preparing for a divorce is determined if ending a marriage is the right choice. This is because the process of splitting can be stressful, financially impactful, and, in some instances, costly and time-consuming.

It's equally important for a spouse considering divorce to do some research ahead of time since each state has different divorce-related timelines. There are also differences with how long a couple has be separated before divorcing. Setting personal and financial goals for the future can also help a soon-be-former-spouse be better prepared for life after marriage. If kids are involved, the general recommendation is for couples to keep the best interests of children in mind when determining custody arrangements. Getting organized during the divorce process typically involves gathering bank statements and other key documents.

California parents who rely on receiving regular child support payments may become concerned if the paying parent develops a physical disability and is unable to meet those obligations. While this may present a financial hardship for both parties, there are certain actions that can be taken.

It is important to find out if the parent responsible for paying child support has disability insurance. Disability insurance benefits, which may be provided by that parent's employer, can be used to make child support payments. However, the amount of disability insurance benefits is typically less than what the individual would normally earn in regular pay. As a result, the child support payment amounts that will be paid are likely to be less. This is because the parent's income is used as the basis for calculating child support, and disabled parents may be able to obtain a child support modification.