Market Experience on Accounts

Certain accounts that may be considered marital property and up for division in the context of a divorce can have fluctuating value based on the market. For example, mutual funds, stock benefits, 401ks, and annuities will reflect gains and losses that can change daily. Similar to other assets, the cut-off date for value purposes is technically the date of separation however gains and losses on that date of separation value through the date of distribution are also considered marital. This can result in a significant sum for an account with a large balance or in the instance of a lengthy separation period.

It is good practice to work with an experienced family law attorney and/or retirement division attorney or actuary to ensure you are getting an equitable distribution of these types of assets. To the extent a Qualified Domestic Relations Order (QDRO) is necessary, your attorney can draft/review an Order with the appropriate language to effectuate the desired distribution. A QDRO is a document that identifies the plan to be divided and gives specific details as to how that division will take place and what rights the party receiving the funds, referred to as the alternate payee, will have going forward. Failure to address the market experience can result in an unfair distribution.

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Name Change Petition

The court has the ability to order a name change of an adult or a minor child. Name changes are permissible so long as it is not sought for illegitimate purposes and the person seeking a name change does not have certain criminal convictions. Specifically, a person cannot request a name change if they have a conviction for murder, voluntary manslaughter, rape, involuntary deviate sexual intercourse, statutory sexual assault, sexual assault, aggravated indecent assault or robbery. A petition for name change should be filed with the civil court in the county where you reside. A filing fee is due at the time of filing as well as copies of your fingerprints which can be obtained at your local police department. A hearing for the petition will be scheduled for one – three months later.

Prior to the hearing date, notice of the petition must be published in the county law reporter as well as a newspaper of general circulation. Additionally, adults must have checks through the Prothonotary’s office for civil matters, the Clerk of Courts for criminal matters, and the Recorder of Deeds for any property issues. If requesting a name change of a minor, in addition to the publication requirements for all name change petitions, you must also proof service on the non-petitioning parent. If the other parent does not agree with the name change, the court will decide after hearing from the parties. A name change of a minor may be granted if it is in the child’s best interests. The party requesting the name change has the burden of proof and must convince the court how the requested change would serve the child’s best interests.

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Same-Sex Adoption

Married same-sex couples can pursue a step-parent adoption. A step-parent adoption requires background checks be completed as it relates to the adopting parents. Presently, there are three background checks required: (1) Child Abuse History Clearance; (2) PA State Police Criminal Record Check; and (3) FBI Criminal Background Check through the Department of Welfare. The rights of the natural parent need to be terminated in conjunction with the adoption petition. This can be via consent of the natural parent or via involuntary termination if grounds for termination exist.

Couples who are not married but interested in adopting a child together can do so following the procedures for a second-parent adoption. Second parent adoptions require the same background checks as a step-parent adoption. They also require a home study whereas a step-parent adoption does not. The home study consists of several visits to the home over a span of time to observe the living arrangements and relationship with the proposed adopting parent. The parental rights of the first parent need not be terminated for the adoption by the second parent to take place. Following successful completion of all the pre-requisites and filing of the Petition for Adoption, the final step is the adoption hearing in either scenario.

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How to Divide Your Retirement Plan

Retirement plans are often one of the significant assets up for distribution in the course of a divorce. Careful attention should be given to the type of retirement plan at issue to avoid tax penalties and/or early withdrawal penalties to the extent possible. Additionally, the type of retirement plan will dictate what will be necessary in terms of documentation or court orders to effectuate the rollover. Non-qualified plans include individual retirement accounts or IRAs. These can usually be rolled over by completion of a form with the applicable institution. You should still do a direct rollover to a similar account to avoid taxes and/or withdrawal fees.

Qualified plans include defined contribution plans such as 401Ks as well as defined benefit plans such as pensions. A Qualified Domestic Relations Order (QDRO) will be necessary to distribute a qualified plan. A QDRO is a document that identifies the plan to be divided and gives specific details as to how that division will take place and what rights the party receiving the funds, referred to as the alternate payee, will have going forward. Rights of the alternate payee may include receiving cost of living adjustments similar to the plan participant and being able to elect their own survivor beneficiary for their interest in the plan. Both qualified and non-qualified plans will be taxable as distributed. The QDRO effectuates a tax-free rollover of funds to the spouse being awarded a share of the retirement plan in divorce but the spouse will be taxed on it when they withdraw it.

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Non-Marital Property

Section 3501 of the Divorce Code sets out what property will be considered non-marital property and therefore not subject to equitable distribution in a divorce case. Any property acquired prior to the marriage that has not increased in value during the marriage is non-marital as well as any property acquired after final separation but potentially prior to the entry of a divorce decree as long as marital property was not used in its acquisition. Any inheritance received is treated as a gift and will also be deemed non-marital so long as it is not subsequently commingled with marital funds. The court will also not look at property that was disposed of in good faith while the marriage was intact. An example would be property sold to a family member for its fair market value. Veterans’ benefits cannot be attached, levied or seized except in the case where a portion of the veteran’s retirement pay was waived in exchange for the benefits. Finally, any payment from a cause of action or lawsuit where the underlying claim occurred before the marriage or after separation. Property acquired prior to the marriage or in exchange for said property is not marital as well as property expressly excluded by valid written agreement of the parties at any time.

Property that is generally considered marital would be all property acquired by either party from the date of marriage through the date of separation that doesn’t fall into any of the above categories. There is a presumption all property acquired during the marriage is marital regardless of how title is held (e.g. individually vs. jointly). It will also include the increase of value of any non-marital property during the course of the marriage.

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Passports for Children

Every person, regardless of age, must have a passport to travel out of the country. Initial passport applications for children under sixteen (16) years of age must be made in person. Both parents of the child should be present. If one of the parents cannot be physically present, they may complete a parental consent form instead. This form must be notarized and a copy of the parent’s ID must accompany the form. There are exceptions to the requirement of the consent of both parents including court order or proof of sole custody. Additionally, there is an application to obtain passport without the other parent on the basis of exigent circumstances and the unavailability of the other parent. You can visit the U.S. Department of State website for additional details on the requirements to obtain a passport at travel.state.gov.

If you are a single parent you should make sure your custody agreement is clear about where the children can travel. A good custody order will dictate that international travel may only be by written consent of both parties or court order. Parents should pay attention to which country the other parent intends to travel to with the child and whether that country belongs to the Hague Convention on Civil Aspects of International Child Abduction and would recognize a U.S. custody order if necessary. Additionally, all details of the itinerary and contact information for the child while away should be provided in advance. The Department of State also handles international child abduction if you encounter a custody problem while your child is out of the country.

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Filing for Support

23 Pa C.S. Section 4321 provides that married persons are liable for the support of their spouse according to their respective abilities to provide and parents are liable for the support of their unemancipated children under 18 years of age. Domestic Relations is the branch of the court that handles support applications. An application for support can be filed with their office in the county where you reside or where the payor resides. An application can also be initiated online through the support program website. Support between spouses is based on the difference in income. 40% of the difference in income can be awarded in a case where there are no children. 30% of the difference in income is appropriate where there is also a child support component. Child support in Pennsylvania is based on statewide guidelines established by the Pennsylvania Supreme Court. The guidelines are based on an “Income Shares Model” such that the guideline amount is shared by the parties based on percentage of custody time as well as percentage of income.

Once an application for support is filed a conference is scheduled. Both parties are instructed to bring relevant documentation to the hearing including pay stubs, last filed tax return/W-2, proof of health insurance coverage and costs, childcare expenses, etc. At the conference an officer will use the income information to complete a calculation and advise of the support award. If there are any issues concerning incomes or expenses or the suggested amount of support, the parties have the option to request a hearing for further review. Though it may take several weeks to get to the conference following submission of an application for support, support awards are retroactive to the date of filing so that applicants can receive support for that time despite the wait for a court date.

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Separation Defined

Most parties pursuing divorce will choose to proceed with no-fault grounds for divorce. A no-fault divorce simply means there has been an irretrievable breakdown of the marriage. There are two different ways to establish an irretrievable breakdown of the marriage under the Divorce Code. First, both parties may consent to the divorce after 90 days from when the complaint was filed and served. This is referred to as a 90-day mutual consent divorce. Alternatively, if one party won’t consent, the other party can move forward after the parties have been “separated” for at least one year. This is referred to as a separation divorce. Separation, however, does not mean the parties have to physically live separately. Parties may elect to still reside in the same home but can be considered “separate” based on the definition provided by the Divorce Code. Section 3103 of the Divorce Code defines “Separate and apart” as follows: Cessation of cohabitation, whether living in the same residence or not. In the event a complaint in divorce is filed and served, it shall be presumed that the parties commenced to live separate and apart not later than the date that the complaint was served.” Accordingly, the date the divorce complaint is filed will generally be accepted as the date of separation regardless of whether the parties continue to live together or not.

The date of separation can be a date earlier than the filing of the complaint. For example, if there is a physical separation the date one party moves out of the marital home is an acceptable date of separation. Alternatively, even if the parties continue to reside together, a date of separation can be established when one party makes it clear to the other party that the marriage is over by stating so clearly or even reducing it to writing. The party alleging separation will have to submit an affidavit certifying the date of separation. The other party has an opportunity to object and a hearing may be held if necessary to determine the appropriate date of separation. Accordingly, be sure that the other party is explicitly aware of your intentions, especially if you will continue to reside together and/or hold off on filing for divorce.

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Step-parent Adoption

It can be a simple process for a step-parent to adopt their step-child. Some of the statutory requirements for adoption are waived in the case of a family member adopting a child. Specifically, a home study, which is expensive and can take several months to complete, is not required. Instead, the step-parent need only complete the necessary background checks.

Presently, there are three background checks required: (1) Child Abuse History Clearance; (2) PA State Police Criminal Record Check; and (3) FBI Criminal Background Check through the Department of Welfare.

As with any adoption matter, the rights of the natural parent(s) must be terminated. If the natural parents are consenting to the adoption, their consents can be attached to the Petition for Adoption. You need to wait at least thirty (30) days after the consents are signed prior to filing them with the court since there is a thirty (30) day revocation period. Alternatively, if lacking written consents, grounds for involuntary termination can be addressed within the adoption petition. There is a filing fee due to the county at the time you file the Petition for Adoption. The filed petition and notice of the hearing must be served on all interested parties. Following successful completion of all the pre-requisites and filing and service of the Petition for Adoption and hearing notice, the final step is the adoption hearing. Generally, the hearing is just a matter of ceremony and a happy occasion for the adopting parents and child.

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Bringing Children to Court

One of the factors for consideration in determining what is in the best interests of the child for a custody award is the preference of the child. It is common for the opinion of the child to be sought in the course of a custody evaluation. There is also the possibility that a child will appear in court to offer testimony. There are rules specific to the testimony of children in Pennsylvania. The policy of the Commonwealth is to promote procedures to protect children witnesses. These procedures are outlined in 42 Pa C.S.A. 5981 – 5988. For the purposes of the provisions in these sections, child is defined as an individual under sixteen (16) years of age. Per Section 5984.1, the court may direct that a child’s testimony be recorded for subsequent presentation in court so long as the method accurately captures all information presented during such testimony.

Similar to the allowance for recorded testimony, Section 5985 allows for the child to testify in a room other than the courtroom with the testimony being transmitted by contemporaneous alternative method. For example, the court may interview the child in chambers as opposed to on the stand in the open courtroom. There should still be a transcript of what was said in chambers. The purpose of this would be to make the experience less intimidating for the child. The court should determine if the child would be subject to serious emotional distress if they had to testify in an open forum and/or before the defendant. It is good practice to contact your Judge prior to any hearing to see if they are interested in speaking directly to the children or if they will permit the children to testify if you would like them to.

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