Protecting Your Business from Your Future Ex-Spouse
When couples says “I do” one must be thoughtful of the potential consequences to a Small Business owner. A Small Business owner without proper preparation and/or knowledge may soon be saying “our assets” instead of “my assets”. Small Business owners should closely examine their fiduciary duties to their spouse in reference to community assets that may arise when two individuals acquire a marriage license and marry or marry by common law. A small business owner can protect his/her premarital property by keeping it under their control rather than risking community characterization.
Pre-Nuptial agreements are binding technical contracts that safe-guard an individual’s properties, monies, and business belongings in detail. These contracts may be specific, complex, and meticulous. An attorney should be consulted. The Pre-Nuptial agreement can dictate, regulate or mitigate manage next of:
- The entitlements of spousal support
- The inheritance regarding Insurance Policies
- The specific allocation of resources and properties in a Will, Trust, or Business
- The marital property claims in reference to both parties
- The ability to Own, Sell, Purchase, Rent, Mortgage, and Regulate any Separate or Community Properties
If an individual has married before a Pre-Nuptial contract is executed there is still hope and a path to take in order to insure protection of your small business. A Post-Nuptial agreement protects a Small Business owner’s property after the fact and should be utilized if required or desired. The Post-Nuptial agreement is similar to the Pre-Nuptial agreement but more care and specificity is required since some or all an individual’s assets may have taken on the attributes of community property because of the spouse’s inherent property rights after the marriage has taken place.
There are three major Ante-Nuptial agreements:
1.) Partition and Exchange Agreement: This Agreement regulates the financial allocation of a Small Business allowing monies and stock to remain separate property rather than becoming community property over time. It also separates and characterizes each spouse’s future income. The agreement allows Small Business owner’s the ability to have independent control over their business without empowering or including their spouse in decision making or management.
2.) Agreement Concerning Income from Separate Property: The principal feature of this agreement is to protect an individual’s corpus & income that exists or is produced by their Small Business. Even If there is an existing Post-Nuptial agreement that inhibits a spouse from attaining stocks or money within a specific Small Business, the actual income the Small Business produces may become community and the other spouse is entitled to their share upon dissolution of the marriage. This is tricky, for a Small Business owner is right in believing that the property and assets of the business itself is independently theirs, but he/she is wrong in the assumption that the profit made by their business is independently theirs as well. This Agreement allows a Business Owner to control, manage, and personally own all the income that is realized through his/her company. This Agreement must be signed by the owner and his/her spouse and should be as concrete as possible to avoid problems in any type of litigation process.
3.) Complex Estate Planning: Estate planning is helpful and smart. Many Post-Nuptial agreements allow independent properties to modify the community status of property to attain certain tax breaks that are applied to married couples. This may put a smile on a Small Business owner’s face for a while as he/she reaps the benefits of tax-deductions, but if a divorce occurs these tax exemptions could become proof of the existence of community property to be awarded to his/her spouse. Pre and post marital agreements may not be necessary dependent on specific situations, but if they are necessary the agreements will ensure the control of one’s business assets, income, and properties. The law was created to help ensure the protection of people’s premarital rights. If you are a Small Business owner read up on yours rights and avoid not being taken advantage of by a once loving spouse in the future.
Texas Divorce Checklist: Planning Ahead
Preparing for a Texas Divorce: Assets
Preparing for a divorce is painful no matter the circumstance. Before you get into the tangle of the Texas divorce process, you can reduce the expense, stress and conflict many people face by making sure you are prepared. Planning ahead allows you to make sound decisions and start preparing for your life post-divorce, and may also help you avoid post-divorce pitfalls. Below is a list of items you need to gather before counseling with an attorney.
Documents
1. A Listing of all Real Property, address and location, including (include time-shares and vacation properties):
1. Deeds of Trust
2. Notes
3. Legal Description
4. Mortgage Companies (Name, Address, Telephone Number, Account Number, Balance of Note, Monthly Payments)
5. Current fair market value
2. Cash and accounts with financial institutions (checking, savings, commercial bank accounts, credit union funds, IRA’s, CD’s, 401K’s, pension plans and any other form of retirement accounts):
1. Name of institution, address and telephone number
2. Amount in institution on date of marriage
3. Amount in institution currently
4. Account Number
5. Names on Account
3. Retirement Benefits
1. Exact name of plan
2. Address of plan administrator
3. Employer
4. Employee
5. Starting date of contributions
6. Amount in account on date of marriage
7. Amount currently in account
8. Balance of any loan against plan
4. Publicly traded stock, bonds and other securities (include securities not in a brokerage, mutual fund, or retirement account):
1. Number of shares
2. Type of securities
3. Certificate numbers
4. In possession of
5. Name of exchange which listed
6. Pledged as collateral?
7. Date acquired
8. Tax basis
9. Current market value
10. If stock (date option granted, number of shares and value per share)
5. Insurance and Annuities
1. Name of insurance company
2. Policy Number
3. Insured
4. Type of insurance (whole/term/universal)
5. Amount of monthly premiums
6. Date of Issue
7. Face amount
8. Cash surrender value
9. Current surrender value
10. Designated beneficiary
6. Closely held business interests:
1. Name of business
2. Address
3. Type of business
4. % of ownership
5. Number of shares owned if applicable
6. Value of shares
7. Balance of accounts receivables
8. Cash flow reports
9. Balance of liabilities
10. List of company assets
7. Mineral Interests (include any property in which you own the mineral estate, separate and apart from the surface estate, such as oil and gas leases; also include royalty interests, work interests, and producing and non-producing oil and gas wells.
1. Name of mineral interest
2. Type of interest
3. County of location
4. Legal description
5. Name of producer/operator
6. Current market value
8. Motor Vehicles (including mobile homes, boats, trailers, motorcycles, recreational vehicles; exclude company owned)
1. Year
2. Make
3. Model
4. Value
5. Name on title
6. VIN Number
7. Fair Market Value
8. Name of creditor (if any), address and telephone
9. Persons listed on debt
10. Account number
11. Balance of any loan and monthly payment
12. Net Equity in vehicle
9. Money owed by spouse (including any expected federal or state income tax refund but not including receivables connected with any business)
10. Household furniture, furnishings and Fixtures
11. Electronics and computers
12. Antiques, artwork and collectibles (including works of art, paintings, tapestry, rugs, crystal, coin or stamp collections)
13. Miscellaneous sporting goods and firearms
14. Jewelry
15. Animals and livestock
16. Farming equipment
17. Club Memberships
18. Travel Award Benefits (including frequent flyer miles)
19. Safe deposit box items
20. Burial plots
21. Items in any storage facility
22. A listing of separate property (property prior to marriage, family heir looms, property gifted)
23. Listing of all liabilities (including mortgages, credit card debt, personal loans, automobile loans, etc.):
a. Name of entity, address and telephone number
b. Account number
c. Amount owed
d. Monthly payment
e. Property securing payment (if any)
f. Persons listed as liable for debt
Supervised Visitation in Texas
What is Supervised Visitation? Supervised visitation takes place between the non-custodial parent and her/his child (ren) in the presence of a third party or family agency who oversees the visit to monitor and ensure the child’s physical and emotional safety. When supervision is ordered, possession and visitation are supervised by a neutral third party or family agency usually with the capacity to enforce effective measures that are normally ordered and enforced by the courts.
What is the purpose of Supervised Visitations? A supervised visit is for the benefit of the child to have safe contact with the non-custodial parent without having to participate in the parents’ mutual conflicts or other potentially dangerous circumstances.
The following is a potential list of acts and circumstances that usually occur before the custodial parent will request, and the court may order, supervised visitation between the child and the non-custodial parent:
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Violence or physical endangerment – A noncustodial parent may be denied visitation rights if the parent has abused the child or threatened physical violence.
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Emotional harm – Where sufficient proof is offered of potential emotional harm or where standard visitation has detrimentally affected a child’s emotional or physical welfare.
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Child’s l wishes – A court may consider the child’s wishes as to visitation. The weight given to a child’s preference is dependent on the child’s age, emotional stability, maturity and motives.
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Abduction – There must be a showing that there is a strong imminent probability of abduction to limit visitation on this basis.
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Substance abuse – A parent who abuses drugs or alcohol may be ordered to supervise visitation restrictions if the conduct endangers the child or if the parent uses abusive language and/or mistreats the child.
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Mental illness –Mental incapacity may be a reason for supervised visitation only if it is determined by the court that there is a reasonable potential for harm to the child due to such mental illness.
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Sexual behavior – Courts rarely deny visitation solely on the basis of a non-marital heterosexual or same-sex relationship. Courts will, however, cancel overnight visitation by a child with a parent because of the parent’s cohabitation on a showing of an adverse and material negative impact on the child.
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Incarceration – Visitations for the incarcerated may be suspended only on a showing that such visits are detrimental to the child.
What are the options for Supervised Visitations?
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Presence of a “neutral” third party: examples would be grandparent or other family member, friends of the family, close neighbors, and other child care providers.
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Presence of the custodial parent: This option is sometimes used when the child is very young. If this option is used the parents must work very hard to not engage in conflict affecting the child.
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Presence at a neutral location and monitored by professionals. These sites are staffed by professional and volunteers are trained for supervised visits. The expense these supervised visits can be very costly and may create a deterrent to access and possession by the non-custodial parent. Such agencies may also provide reports and recommendation to the court based on the success or failure of the supervised visits. These recommendations assist the courts in making informed decisions regarding supervision and whether continued supervision is actually associated and necessary or in the best interest of the child(ren).
If You Owe Back Child Support in Texas : Possible Trouble Renewing Your Texas Drivers License!
Texas HB 1846: Suspension or denial of issuance or renewal of a license for failure to pay child support
The court or Title IV-D agency may stay an order suspending a license conditioned on the individual’s compliance with:
- A reasonable repayment schedule that is incorporated in the order
- The requirements of a reissued and delivered subpoena
- The requirements of any court order pertaining to the possession of or access to a child
The court or Title IV-D agency may not stay an order unless the individual makes an immediate partial payment in an amount specified by the court or Title IV-D agency. The amount specified may not be less than $200.
A licensing authority that receives the information shall refuse to accept an application for issuance of a license to the obligor or renewal of an existing license of the obligor until the authority is notified by the child support agency that the obligor has:
- Paid all child support arrearages
- Made an immediate payment of not less than $200 toward child support arrearages owed and established with the agency a satisfactory repayment schedule for the remainder or is in compliance with a court order for payment of the arrearages
- Been granted an exemption as part of a court supervised plan to improve the obligor’s earnings and child support payment
- Successfully contested the denial of issuance or renewal of license
An order suspending a license rendered before the effective date of this Act is governed by the law in effect on the date the order was rendered.
Texas HB 1846 takes effect September 1, 2013
New Texas Paternity Law Texas HB154: Termination of Mistaken Paternity & Duty to Pay
Texas HB154: Termination of the parent-child relationship and the duty to pay child support in circumstances involving mistaken paternity. This law, effective immediately, aims to further protect a mistaken father from certain child support payment obligations. This new law also amends the current law, SB785: Mistaken Paternity.
The new law states that a petition must be filed not later than the second anniversary of the date on which the petitioner becomes aware of the facts alleged in the petition indicating that the petitioner is not the child’s genetic father.
An order termination the parent-child relationship ends the petitioner’s obligation for future support of the child as of the date the order is rendered. Also the obligation to pay interest that accrues after that date on the basis of a child support arrearage or money judgment for a child support arrearage existing on that date.
Those obligations are enforceable until satisfied by any means available for the enforcement of child support other than contempt. This applies to the current law suit pending in a trial court on the effective date of this Act or filed on or after that date is affected.
NACOL LAW FIRM P.C.
8144 Walnut Hill Lane
Suite 1190
Dallas, Texas 75231
972-690-3333
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Friday, 8:30am – 5pm
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Attorney Mark A. Nacol is board certified in Civil Trial Law by the Texas Board of Legal Specialization
