Social Security Benefits

Social Security retirement benefits are payable based on an individual’s prior earning’s history. A party in divorce may be entitled to collect social security benefits based on the earnings history of their spouse instead of their own. For this to be an option, your spouse must already be at least 62 years old and receiving their social security benefits. Additionally, you must have been married to your spouse for at least ten years and be at least 62 years old. There is an exception to the age requirement if your spouse is deceased in which case you can start collecting at 60 years old or 50 years old if you are disabled. You cannot be remarried at the time you are electing to receive a spouse or ex-spouse’s benefits however, remarriage is permissible if it occurs after age 60 or age 50 if disabled.

Finally, your social security benefits based on your earnings history must be less than your spouse’s benefits. You can only elect to receive one social security benefit and should opt for whichever is higher. By electing to receive benefits under a spouse’s earnings history you do not diminish the benefit your spouse is entitled to receive themselves. You spouse will continue to receive the full amount of his or her benefit. You are entitled to receive 50% of the benefit your spouse is receiving. If, however, your spouse pre-deceases you, you are then entitled to receive 100% of your spouse’s benefits. Further, any children under 18 at the time of your spouse’s death would be entitled to certain benefits as well.

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Birth Certificates

Additional copies of a birth certificate may be ordered from the Department of Vital Records. An application is required along with a fee. Fees may be waived for members of the armed forces Parties that may request a birth certificate include attorney or legal representative (documentation may be required), spouse, parent or step-parent (must submit marriage record supporting the relationship), grandparent or great-grandparent (specify maternal or paternal), and power of attorney for person named on birth certificate or immediate family member listed above. The following individuals may also submit an application if over age 18: person named on the birth certificate, siblings (including half siblings), children or step-children, grandchildren and great-grandchildren.

Simple changes to a birth certificate can be made by agreement of the parents through the Department of Vital Records as well. Desired corrections can be stated on the back of the birth certificate and must be signed by both parties in the presence of a notary. A change in civil status form is required for a name change on a birth certificate due to the subsequent marriage of the biological parents. An acknowledgment of paternity form must be filed to have the biological father added to a birth certificate where no one was previously listed. The Pennsylvania Department of Vital Records can be reached at (844)228-3516 or at the address below:

Division of Vital Records Attn: Corrections Unit 101 S. Mercer Street, Room 401 PO Box 1528 New Castle, PA 16101

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Jurisdiction

Jurisdiction grants a court the authority to make legal decisions and judgments. Jurisdiction is most frequently obtained by residency. Residency is required to file a divorce in Pennsylvania. Under Pennsylvania law, specifically 23 Pa. C.S. 3104(b), one of the parties to the divorce action must have been a bona fide resident of Pennsylvania for at least six months prior to the commencement of the divorce. Bona fide residence is defined as actual residence with domiciliary intent. Domicile denotes the place where a person has his or her true, fixed, permanent home with the intention of returning after any absence. In other words, where an individual sleeps, takes their meals, receives mail, and stores personal possession. Members of the military are considered to be residents of their home state even if they are stationed elsewhere at the time a divorce is commenced. The home state would be the state where they intend to return to and reside in following any term of active duty.

Jurisdiction for custody matters in Pennsylvania also has a six (6) month residency requirement. Per the Uniform Child Custody Jurisdiction and Enforcement Act, jurisdiction is proper in the home county of the child which is where the child has resided for at least six months prior to commencement of the action. Temporary absences from the county do not negate residency for the purposes of jurisdiction. In emergency situations, the six (6) month residency requirement may be set aside. Temporary emergency jurisdiction may be exercised if the child is in the jurisdiction at the time and it is necessary to make an immediate determination to ensure the child’s safety. For example, an emergency order may be entered if a child has been abandoned, or is subject to mistreatment or abuse. An emergency order would only be valid until a court with jurisdiction as the home state of the child makes a determination.

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Mortgage Payments

A jointly owned property is frequently addressed in family law actions. It may be defined as a marital asset hence subjecting it to equitable distribution. Financial responsibility for the property may also be a factor in the context of a support action. If only one party is making payments on a marital residence while a divorce is pending, they may be able to seek a credit for payments made. This may be the case if both parties are residing in the home or if the party not contributing to the mortgage is residing in the home. Mortgage payments may also be considered in the course of establishing a support award. Pennsylvania Rule of Civil Procedure 1910.16-6 covers adjustment to basic support awards and allocation of additional expenses. Under sub-section (e) mortgage payments, real estate taxes, and homeowners’ insurance may need to be considered. Second mortgages, home equity loans and other obligations secured by the marital residence may be considered but are within the discretion of the court and addressed on a case-by-case basis.

The expense to maintain the marital residence can be considered if the total expense exceeds 25% of the obligee’s (party receiving support) or obligor’s (party paying support) income. If the obligee is in the marital residence and paying the mortgage, the court would look to see if the mortgage payment exceeds 25% of the obligee’s income after considering the basic support award. If the mortgage is still more than 25% the court can direct the obligor to assume up to 50% of the excess resulting in an increased support award. Obligors can also receive assistance with the mortgage if they are the party in the marital residence or responsible for the payments. The basic support award is subtracted from the obligor’s net income first. If the mortgage payment is more than 25% of the remaining net income available to the obligor, the court may make a downward deviation in the basic support award. The mortgage deviation is only applicable prior to final equitable distribution in the divorce matter. Additionally, the courts are more likely to allow for a mortgage deviation in cases where the home is ultimately going to be sold as opposed to a case where one party intends to keep the residence post-divorce.

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Treatment of Veterans’ Benefits

Former military members may be eligible to receive a number of different veterans benefits from the Department of Veterans Affairs (VA). Possible benefits include disability compensation, pension benefits, life insurance, educational benefits and more. Veterans benefits cannot be divided as an asset in a divorce case. This is due to the Uniformed Services Former Spouses’ Protection Act (USFSPA). The Pennsylvania Divorce Code confirms this rule. Under 23 Pa. Section 3501(a), discussing the definitions for marital benefits, veterans’ benefits exempt from attachment, levy or seizure are defined as non-marital. Additionally, the veteran gets to decide how to use educational benefits and who to designate as beneficiary for their life insurance.

Veterans benefits can be classified as income for purposes of determining a child support award; specifically, disability payments. The disability payments are intended to compensate the veteran for lost earnings and to support their family. There are restrictions as to when veterans’ benefits can be garnished. In the event the benefits cannot be garnished, that does not mean that the veteran is not still responsible for the support payments as determined by the guidelines.

Copies of the current support order and records of any arrears owed and former payment history will need to be supplied to the VA to review as evidence when making its determination on whether garnishment is appropriate and a reasonable amount to be garnished.

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Pre-Nuptial Agreements

A pre-nuptial agreement is a private contract between the parties entered into prior to their marriage that outlines how assets and debts will be handled if the parties subsequently divorce. A basic and straight-forward pre-nuptial agreement could provide that each party retains anything they came into the marriage with as well as anything they acquire in their own name and that anything acquired jointly during the marriage will be divided equally or pursuant to their jurisdiction’s divorce laws. A pre-nuptial agreement can also be much more specific and detailed in how it addresses pre-marital and marital property, regardless of how it’s titled. An agreement may also address support for a spouse in addition to division of assets. For example, an agreement could provide for an increasing amount of support to a spouse based on the number of years married or number of children produced. It could also act as a waiver to any future support such that neither party could subsequently request any form of spousal support.

A pre-nuptial agreement is a form of contract and must meet several requirements to be valid. One, there must be a full and fair disclosure of the financial resources/existing assets by both parties. If there is not such a disclosure, there must be a provision in the agreement providing that the parties voluntarily and expressly waived the right to disclosure. Two, it must be clear that both parties voluntarily entered the agreement. For these reason, the agreement should be signed well before the wedding to avoid any challenge to the agreement that a party was under duress or felt forced to sign because the wedding date was fast approaching. Finally, steps should be taken to make sure the agreement is not invalidated on the basis of fraud or misrepresentation. Any challenge under the above listed causes of action will result in a fact-based analysis with the standard being a preponderance of the evidence, or more likely than not.

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Business Perks

It is not uncommon for self-employed parties or parties with ownership interests in a business to have some expenses paid for by the business. Examples may include paying their cell phone bill, car payments or repairs, travel expenses, entertainment costs, membership dues, etc. Many of these expenses can subsequently be deducted as legitimate business expenses in terms of preparing a business tax return however, they are treated differently in the context of family law. The issue of how personal perks are being paid often arises when trying to identify income available for child or spousal support. The value of some of these “business expenses” can be added back to a party’s income for purposes of a support calculation.

Business perks are also relevant in the context of a business valuation. An income based approach is most popular for small businesses. This method of valuation focuses on the cash flow of the business. The reasonable compensation of the party owner should be deducted from the cash flow of the business in doing a valuation however, the personal perks paid by the business on the owner’s behalf would need to be accounted for and subsequently, necessary adjustments would need to be made. Removing all expenses representing personal perks paid to the owner will increase the total income of the business and in turn, increase the value. If there is more than one owner a similar review of what business expenses are actually personal perks should be done for the other owners as well.

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Guardianship

Guardianship is an option for any individual who has trouble or is incapable of making their own decisions. A court may appoint a guardian and grant the guardian authority to make decisions on behalf of the individual who has been deemed incapacitated by the court. The standard for incapacity involves an analysis of whether the individual can manage their financial resources and/or meet essential requirements for their own health and safety. A petition should be filed with the court to initiate a guardianship proceeding. Shortly after filing a petition you will be assigned a hearing date. The petitioning party has the burden of proof to demonstrate guardianship is absolutely necessary. This generally involves securing expert testimony from a treating physician regarding the extent of the incapacity and necessity for a guardian.

Notice of the hearing and a copy of the petition must be served on the individual for whom guardianship is sought (Respondent) explaining in plain language the possible ramifications of the forthcoming legal proceedings. Notice must also be given to additional interested parties such as other family members. The court’s decision will address the nature and duration of any guardianship to be instituted. For example, the court will state whether it is limited guardianship or plenary guardianship. Limited guardianship is appropriate where the Respondent is not totally incapacitated and only needs assistance with certain areas and so the court would dictate what specific powers the guardian will have. The appointed guardian must act for the best interests of the Respondent and file a report each year with the court regarding the ongoing care of the Respondent. The Respondent or any other interested party can petition the court to modify or terminate the guardianship if circumstances change or if the appointed guardian is not acting appropriately.

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How to Approach the Subject of a Prenup

As a wedding day approaches, most couples are consumed with thoughts of dresses, flowers, music, food, fun, and love. The last thing anyone wants to think about, much less talk about, is how assets will be divided in the event of divorce! However, this is a conversation that many couples need to have. Marriage is full of tricky discussions – it’s ok to start practicing that skill now.

There are many benefits to talking about a prenup. One of those is that the discussion will force you to look at your financial situation and examine both of your attitudes about money. Frankly, a deep discussion about finances should be a prerequisite to marriage, as money is a huge source of friction and discord in many relationships.

Beyond the benefits of discussing financial matters, there are several situations in which having a prenup in place is a good idea, such as:


  • If there is a large financial disparity between the two parties
  • If you own all or part of a business
  • If one of you has a large amount of debt
  • If you are remarrying, especially if there are children involved.

Regardless of your reasons, discussing a prenup can be difficult. Sometimes both parties heartily agree to a prenup. In other cases, one person has to convince the other. Here are a few tips for approaching the subject of a prenup:

Pick the Right Time

Don’t bring up a prenup in the heat of the moment or in the middle of an argument. Likewise, don’t introduce the topic in the middle of a romantic dinner to commemorate the anniversary of the day you met. Pick a quiet, neutral time to bring up the topic – when you are both well-rested and calm.

Consider a Mediator

You could suggest a meeting with a mediator who can help you discuss the advantages of a prenup impartially and without emotion. If you decide to move forward and draft a prenup, the mediator can also help you by asking all of the important questions, gathering information, and offering sound, logical advice. Again, a mediator can remove the emotion from a tender subject.

 

Be Honest

Be truthful and straightforward about why a prenup is important to you. Be very open about your financial situation – the good, the bad, and the uncertainties.

Listen

If your partner is opposed to the idea of a prenup, listen to their concerns. Don’t jump right in with arguments.

While you certainly do not expect your marriage to end in divorce, a prenup can allow you to open important lines of communication, have an honest dialogue about financial matters, and ultimately allow you to retain more control of your financial situation, rather than giving that control over to the court system. Approaching the topic is not easy. Remember that a trained attorney can help.

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Recognition of Foreign Orders

U.S. Courts have recognized foreign support/custody orders, divorce decrees, adoption decrees, and money judgments. A court will recognize a foreign Order under the doctrine of comity so long as the party has established domicile in the foreign country. As discussed in Hilkmann v. Hilkmann, “[c]omity is a recognition which one nation extends within its own territory to the legislative, executive, or judicial acts of another. It is not a rule of law, but one of practice, convenience, and expediency. Although more than mere courtesy and accommodation, comity does not achieve the force of an imperative or obligation…Comity should be withheld only when its acceptance would be contrary or prejudicial to the interest of the nation called upon to give it effect.” 2003 PA Super 25 (2005).

The two primary considerations when determining whether to acknowledge a foreign Order are whether the foreign court had jurisdiction and whether fair procedures were used. Jurisdiction is governed by domicile of at least one of the parties. In Commonwealth v. Doughty, the court held “[i]t is an established and familiar principle that judicial power to grant a divorce is founded on domicile. In the absence of domicile by at least one of the parties to the action, the Court has no jurisdiction over the cause and its decree will consequently, not be endowed with extraterritorial effect.” 187 Pa. Super. 499 (1958). Accordingly, “[a]n absolute prerequisite to judicial recognition of an out-of-state divorce is that the plaintiff must have resided in the state or country for a minimum period of residency as determined by local authority and that the residency be accompanied by domiciliary intent, i.e., an intent to remain in the foreign jurisdiction.” Sargent v. Sargent, 225 Pa. Super. 1 (1973).

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