Divorce Decree Financial Crisis

[Raoul]

Our divorce was final in mid-January. I am a betrayed husband. We have three kids and share custody.

 

The court's decree includes over $3,000/mth in permenent alimony and $1,500/mth in child support. Worse, both of these backdated 7 months. So I owe her over $30,000 and then going forward.

 

I live in, pay for and maintain the marital home, now to be sold (in a lousy market). I paid off her car and repaying a home equity loan for the car her boyfriend drives.

 

I do not have and cannot get the money either to pay the 'arrears' or the current court requirements.

 

My attorney is filing a motion for reconsideration. I have talked with a bankruptcy layer. But because bankruptcy does not affect court orders and the only other debt I have is mortgage related, bankruptcy doesn't change anything.

 

I am self-employed in a business that is less than half of what is was before the recession. My ex has a secure job with benefits and pension.

 

Your thoughts on how to live with these circumstances are needed.

 

And if anyone klnows of divorce crisis services available in New Jersey, please tell me.

 

I've always done the right thing. But I cannot do this. If I try to pay the mortgage and related bills and a little food and pay > $600/mth in COBRA health benefits, I cannot pay the alimony and child support. Yet the court insists that I do this.

 

Please help.

 

Raoul

[Crazyaboutdogs]

This is out of my league so I have no constructive advice I can give. I really don't understand, how in this day and age, a woman who is working is entitled to alimony. Child support is a given..but alimony on top of that is unbelievable. I have noticed that courts often side with the wrong-doer. I hope your lawyer can get this decision modified to your benefit.

[Raoul]

Crazyaboutdogs,

 

Thanks. But it is clear to me that though lawyers, courts and judges know and apply the law, they are innumerate as well as financially blind, deaf and dumb.

 

My attorney and I tried every means available under the divorce 'Family Court' system to establish how crazy the numbers are in this.

 

As for siding with 'wrong-doers', you can thank no-fault divorce laws.

 

Raoul

[Real Deal]

$3000 a month in alimony Raoul? Are you a Hedge Fund Manager? Okay, sorry for the joke. Did they base it off of your current income? How long have you been given to pay the "arrears" portion. Man, really sorry to hear this brother? How is it that you are paying alimony if she has a stable job? Sorry for all the questions but need the info to further advise (not that I'm a lawyer).

[Raoul]

$3000 a month in alimony Raoul? Are you a Hedge Fund Manager? Okay, sorry for the joke. Did they base it off of your current income? How long have you been given to pay the "arrears" portion. Man, really sorry to hear this brother? How is it that you are paying alimony if she has a stable job? Sorry for all the questions but need the info to further advise (not that I'm a lawyer).

 

Real Deal,

 

No hedge fund manager here. I did okay through 2008. Business (I am self-employed) is about half of what it was then.

 

She earns $97,000/yr. and has great current and retirement benefits (long-term state worker). Big part of the problem is that her benefits are not valued in her income figures; meanwhile lots of taxes I pay (Social Security, Medicare -both halves, Alternative Minimum Tax) and much else don't get deducted from my figures. All this mind you on an income 'lookback' to when the company was doing way better than now. Add to that, I've been paying the mortgage, etc. on our home and essentailly none of that comes back to me.

 

Its the 'recipe' that the court uses. It does not know how to look at me under these laws. My attorney and I tried everything during the trial and got nowhere.

 

I do not know what's going to happen to me. I do know that nothing good can come of this.

 

 

Raoul

[CatsMeeoow]

Ok - from the time you separated and filed divorce and then the divorce became final were you paying any funds at all to your now ex wife and kids? Paying any debts that are now theirs? Do you have record - cancelled checks and receipts? I would believe that any money you paid to your ex wife from the date of separation would come off the $30,000 if you can provide proof of payment.

 

Most courts will take back support and divide it up over X months and add it to the current support order. Have your attorney ask for 10yr for repayment of that.

 

If your income has changed dramatically (and frankly who's hasn't???) due to economy you must be able to document it and present it to court. Your child support is typically based on a formula of your income and your ex wifes income - do an internet search as most states have calculators that you just plug in the numbers and it calculates it. Most states have rules at how often it can be changed. In my state its once every 12months and must change by 20% either way before a new order is inacted unless there is an extreme hardship. $1500/mo for 3 kids isn't outlandish. I live in the Midwest and get $1000/mo for one child.

 

The alimony seems high and I'm surprised its permanent but I don't live in New Jersey. Most states will call it maintenance and award it 3 to 5 yrs for a woman who may have stayed at home to get training and get a job to support herself (my husband made sure he got his ex off the couch while they were married and into school and a job... she drug her feet and it took her 6yr to get a 2yr degree... they had free child care the entire time... she insisted after taking a class at a time she needed her summers off to rest and recuperate... though she promised she would immediately find a job... that didn't happen but once she got her degree... got a job... he left and he wasn't obligated to pay maintenance.) My guess is that number is based on the last few years of tax returns? Or, at least the value of when you filed? And, while she is employed your income must have been considerably more than hers? You will have to document the value of your business currently to show you cannot make those payments.

 

Do you feel you had a good attorney? If not it might be of value to find a new one.

 

Hang in there and love your kids!!!!

[Real Deal]

Man, 97k a year on her end is no drop in the bucket either. I do not see how this is even possible. On top of it all you guys share custody (50/50 I assume) and you still pay child support. I hate to say this and you may feel like you are selling him (or her) out but I would talk to another lawyer besides your current one. It shouldn't cost you anything, but it sounds like he may have f'd it up.

[Raoul]

Man, 97k a year on her end is no drop in the bucket either. I do not see how this is even possible. On top of it all you guys share custody (50/50 I assume) and you still pay child support. I hate to say this and you may feel like you are selling him (or her) out but I would talk to another lawyer besides your current one. It shouldn't cost you anything, but it sounds like he may have f'd it up.

 

Real Deal,

 

If only. This guy is my second attorney. My original attorney spent more time making my wife's case to me than in making my case to her and her attorney.

 

The days of great divorce lawyers in NJ are gone. Its all formulas now. Its just the the ingredients to the formula are wrong to nayone that has a whit of financial sense.

 

The court is supposed to follow the original law, as informed by case precedents and consider each case as 'informed' by law and precedent. Its that last part that really don't do. They simply do what they did the last 1,000 times.

 

Lawyers are lawyers for a reason (and judges are amost always laywers too). They cannot count or deal with basic financial concepts, divorce lawyers anyway. I work with securities and tax lawyers all the time, but they are way different from trial attorneys and 'family court' types.

 

Much of what happened to me happens to everyone going through the system here, men and women. Its wrong and the judges and attorneys know it. They're just earning a living on it and there's no money for them in fixing it.

 

 

Raoul

[Real Deal]

I'm not sure what you do but I am 'self-employed' too and even though my spilt on the money side was pretty civil and fair with my ex I ensured that once I went back to working for myself last year in October that I set up my LLC where I decide how much income I "show". It may have to do with how your company is structured too. Granted, I just did what my lawyer told me to so I have no idea if this would hold up in court if she were to ever seek out more CS or go after Alimony (which I do not think she can seek alimony at this point since we are final). It may help if you looked into re-structuring from what you are now if you are not bound to be a certain type (S-Corp, LLC, etc.) Just a thought.

[Raoul]

Real Deal,

 

I'm incorporated (LLC). The income I put on our 1040 is like anyone else's with an 'S' corp or LLC. But where the court seems to pick up that number is ahead of self-employment tax (@ $20,000), AMT (@ $8,000) and 401(k) type retirement funding (as much as $40,000 in good years - last funded in 2007). I used her benefits. Now I have to use COBRA @ $600/mth.

 

Meanwhile, her W-2 'income' excludes the value of current and retirement benefits and even her deferred income (which I set up for her years ago).

 

So we're not 'apples to apples'. But the court does not want to vary its recipe for me.

 

I've looked into rrestructuring. Hell, I've looked into bankruptcy. None of that helps according to attorneys. Our home mortgage and a HELOC are my only debts and so not affected by bankruptcy. And court ordered payments are not discharged via bankruptcy. The alimony and child support won't be affected by a company change either.

 

I'm stuck and screwed. Thing is, my kids will get the worst of it when I go down. My ex thinks becaue the court ordered it, I have it and must pay. If the court sees it that way, I guess I'm going to jail.

 

Raoul

[corrin]

Raoul, Sorry you are going through this. Keep your head up. Eventually things will get better.

 

Can you give me a little more information:

 

1. How long were you married?

2. How old are your kids?

3. What percentage of the time do you have custody?

4. Did you pay any support to your ex-wife in the seven months before your divorce was finalized?

5. Did you have a trial?

6. What county and what judge?

[Real Deal]

Raoul,

 

I am truly sorry my friend. I hate to hear of these stories and have read some of your posts about your sitch since I joined. You sound like a logical and strong man and a good father. These are all things that nobody can take away from you! I agree on the thing with the kids, that should always be our focus. THEY will know the truth when the time comes. It is funny how you can share so much time with someone and then they want to see you go down in flames. In other words they will basically cut of their nose to spite their face if it means you will suffer (jail). When in the end if they looked at everything from a logical point of view they would still get plenty of money to live a good life (say $1000 in alimony and the $1500 in CS for your case) but that is not enough.

 

I wish I could tell you I had a solution but I don't. However, I have a friend that was getting screwed hard and was able to get things adjusted to be more fair. Granted, his job is not like yours and different state, etc. but let me talk to him anyway. Can't hurt anything.

 

There is a saying from this movie with Jack Nicholson.

 

Woman: "How do you write women so well?"

Melvin: "I think of a man, and I take away reason and accountability."

 

No, I am not a woman hater at all. In fact they are great but it is true in many cases and funny if nothing else. Go do something for yourself today my brother! You will feel better.

[Raoul]

Can you give me a little more information:

 

1. How long were you married? 24 years

2. How old are your kids? 19, 17, 14, boy, boy, girl

3. What percentage of the time do you have custody? Not 50% as daughter spends only alternate weekends with me.

4. Did you pay any support to your ex-wife in the seven months before your divorce was finalized? No.

5. Did you have a trial? Yes.

6. What county and what judge? Mercer - Fleming

 

Sending you a PM

 

Raoul

[corrin]

The 24-year marriage explains the lifetime alimony.

 

Still, I am surprised by your outcome. With your wife's income, your alimony and child support obligations suggest that the court believed your income is north of $200,000 a year. I clerked in the Family Division when I got out of law school. I can tell you that cases where the husband is self employed are always difficult. I suspect your wife argued that you receive some of your income in cash and/or that you have some other means of diverting or forestalling income.

 

The outcome also suggests that the judge was not pleased with you. Did you violate any of his preliminary orders? Also, did you have a reason for not paying support during prior to your divorce being finalized?

 

I would consider appealing the decision (assuming your motion for reconsideration is denied). It will be an uphill battle to convince the Appellate Division to overturn the trial judge's findings of fact with regard to your income. But it's all you have right now. After that, you may be able to modify your judgment due to changed circumstances. A creative lawyer will figure out how to relitigate your income issues through changed circumstances.

 

Good luck.

[Raoul]

Corrin,

 

Thanks for your thoughts. Not to brag, but I did (past tense) make north of $200k. Not now. And you are right, I do pay some family expenses through the business though nothing that wouldn't survive an IRS audit. I am conservative that way. I have never 'diverted or forestalled' income. The business is a solo consultancy. The books for both my business and family are about as complicated as a glass of water.

 

You're not right about how I behaved ahead of or during the trial. I responded to everything ever asked of me immediately and in detail. She prepared essentially nothing, awaiting the system to roll over me which was a good bet.

 

No one asked for 'pedente lite' (please excuse my Latin). She was making out so well under the financial 'arrrangements' (she left, got a cheap apartment while I kept paying all the bills - including her cars) that her attorney must have known to leave that alone.

 

I do think that the court has no idea how to look at self-employment vs employed income. I do hope that the reconsideraton motion works as I'm told that appeals are fantastically expensive. Changed circumstances hardly describes where I am right now.

 

Raoul

[Lester]

Dear Raoul, How hard! My heart goes out to you. You are getting some good advice above and sounds like you may have some options.

I can only add... there is a huge difference between lawyers. Look for one that is performance driven. I just came out of a lawsuit with regards to the company I work for. The company had insurance, which in turn selected the Law firm.

I was never so impressed by an attorney in my whole life! He had a second to none memory and command of the facts.

Try contacting your insurance company for recommendations. I wish I could help you more. Hang in there! I’ll say a prayer for you.

[Raoul]

Lester,

 

I agree that in some fields of the law, there are good people. But in NJ divorce, the process is so formulaic, there is no room for creativity it seems. They (lawyers, judges) just do what they did the last 1,000 times.

 

Thanks for your thoughts,

Raoul

[BrokenHead]

Raoul,

I can not offer you much in the way of advice, I am in much the same situation as you are (albeit much earlier in the process--haven't filed S/D) but I know the same train is going to hit me WW/SAHM clearly will push for the court to make our D/S a retirement plan for her after 22 years of M (she's all but said it).

 

The only thing I can offer you when things get better for both of us is a couple of cold ones. I am in CT and my sister is in NJ and I am going to look you up and make good on that promise.

 

BH

[3boys]

Not to make light of your situation, but I have a friend who needs to move to NJ....STAT!!! She is currently going through a divorce after a 20 year marriage, has only been able to find part-time work (has 2 jobs making

 

I certainly hope your reconsideration motion works because it definitely sounds like you are getting the shaft. I honestly don't see how a court can award someone who is already making close to $100,000 another $36,000 in alimony??? It just doesn't seem right...the child support doesn't seem excessive (and I'm assuming you have no issues with that???), but the alimony just blows me away!

[Raoul]

3boys,

 

Everywhere you look, the divorce-legal system is broken. Yet, those along for the ride (the lawyers, judges, etc.) just keep feeding people into it while the results are confused and crushed people. No matter to those who work the system for their livings.

 

Law is, by design, an adversarial process (combat), waged through professional advocates under strict rules. It is supposed to take the fundamental legislation, informed by cases and precedents and consider the facts of each case under those laws, casses and precedents.

 

There is good reason to attempt this. Equal justice under law is a good concept as is stripping away the very human emotions built into things like divorce. A dispassionate process is necessary. A process devoid of circumstances and decency is not.

 

The facts in each case get crushed under the weight of process. The courts just do what they did the last 1,000 (or more) times. Thus, my situation, your friend's and millions of others.

 

Not giving in or just giving up is difficult. There is no one to talk to about this stuff.

 

Raoul

[Lester]

Hi Raoul, I did hear of one man paying alimony in NJ. He was sort of a * * * * * , cheated, etc. But if it is as you say, shouldn’t most of the divorced women in that area be receiving alimony?

[Raoul]

Lester,

 

Cheating does not matter, even if you file for 'cause' (no-fault). Income differences between spouses is the standard. Problem is, the court does not know how to compare self-employment income to employee (IRS -W-2) income and does not want to 'change their process'.

 

Raoul

[superfox]

I know nothing of US law but man I feel for you, hope everything works out ok.

[3boys]

I did some googling on NJ divorce law regarding alimony with both spouses working and came accross a page that might have some useful information for you....if nothing else, it has some links to trial law decisions that might be helpful: link removed I don't think many of them deal with self-employed income, but there are quite a few on reconsideration and modification of alimony due to changed circumstances....in particular, check out the "Walsh v. Walsh" case because it sounds like your situation to a "T"

[Raoul]

I did some googling on NJ divorce law regarding alimony with both spouses working and came accross a page that might have some useful information for you....if nothing else, it has some links to trial law decisions that might be helpful: link removed I don't think many of them deal with self-employed income, but there are quite a few on reconsideration and modification of alimony due to changed circumstances....in particular, check out the "Walsh v. Walsh" case because it sounds like your situation to a "T"

 

Thank you 3boys. I''ll look at this very soon.

 

Raoul