Why a Prenuptual Agreement is a Key Business Protection Tool

Under New York Law by default, all property is considered marital property. It is the burden of proof of the party claiming that the property is separate property, to prove that it is separate property. Even if the property is clearly separately owned by the titled spouse, the court will order an expert to be hired to value the property to assist the court to determine the value of any equitable distribution that may be awarded. Every business owner should consider a prenuptial agreement an essential insurance policy. Both the process and costs of business valuation can cripple a business.

Imagine owning a business for 20 or 30 years and being required to turn over to an expert all financial documents from your files. They need the documents so they can conduct a forensic evaluation to determine whether you hid money or improperly accounted for profits on your tax returns. That would be alot of paper which means alof billable hours for the forensic evaluator. Imagine turning over documents from the last 3-5 years. That too may be a daunting task. 

Having a prenuptial agreement in place shifts the burden to the spouse who does not own the business to prove the property should be martial property. A prenuptial agreement, if done correctly in both procedural execution and substance, is solid evidence that the business was separate property. That means it would not subject to evaluation by an expert for valuation and you and your employees can continue doing the work that makes your business profitable. Some experts may charge $5000 for a small closely held company but when you have more documents in a larger business, expect the rates to skyrocket. 

If you are interested in learning more about how a prenuptial agreement can protect you and your business, contact Diana Mohyi Attorney at Law for a consultation. 

Why a Billionaire Does Not Pay Child Support Based on His Entire Income

In New York, child support for one child is generally 17% of the combined income of the parents combined income. However that does not mean that the child support seeker can get 17% of a billionaire’s income. Courts may apply the 17% to the total combined income but they are not required.

The court will generally calculate that child support is 17% of the both parents’ combined income up to an income cap.The income cap changes every year to keep up with economic factors like inflation. The 2019 combined parental income cap is $148,000.

It is up to the child support requester to prove why the child needs support calculated on the rest of the income beyond the cap. Generally that is accomplished by proving that the child previously enjoyed a certain standard of living before the parents split, that must be maintained, or that the child has a need for a certain amount of support. 

Child Support not only includes a percentage of the combined income but also includes ‘ad-on’ payments for other things that a child might need such as education, medical care and day care expenses. 

Beware that there is also a Self-Support Reserve which puts a limit on the amount of child support a payor must pay. The 2019 self support reserve is $16,862. The minimum support a payor must pay is $25.00 per month with an arrears cap of $500. If the payor has other children he is paying support for, that amount comes out of his income before a calculation of support is done for the newest child. The requirement to pay child support cannot put a payor below the poverty income level. In 2019 that poverty income guidelines amount is $12,490.

If you are seeking child support or need to defend a petition for child support, contact Diana Mohyi Attorney at Law P.C. to learn more. 

Family Court vs Supreme Court – The Cost Benefit for Custody Proceedings

Even Miranda Priestly had to go to think about the best option to get custody of her twins so why wouldn’t you?  Different costs and benefits exist in a decision to start the dissolution of your family unit in family court versus supreme in a New York Custody battle. 

As I mentioned in a prior post, you cannot get a divorce in family court. However, you can get custody in family court and then go to supreme court to finnish off the financial aspects of the divorce. The benefit is that family court has zero filing fees and can be a relatively quicker process than supreme court. As a result your attorney fees could potentially be less if you started the dissolution of your family unit in family court. Also, your children would not be in limbo about what the final custody arrangement ends up being. The order from the family court would be introduced to the supreme court when the divorce action commences as proof that this aspect of the divorce was resolved. 

The benefit of starting the action in supreme court is that the entire proceeding is before the same justice. That justice would get to know the family dynamics of your case that would necessarily impact your finances. You would not have to get used to the particular habits of two different judges. Your divorce lawyer, who would handle the supreme court matter may have more interaction with the supreme court judges than the family court judges. The atmosphere of the family court is more pro se friendly. Family Court judges are more used to dealing with self represented litigants. Although not recommended, this is important if you only have finances to hire a divorce attorney to resolve your financial issues in supreme court. 

If you are considering whether to pursue a custody order in family court or commencing a divorce in supreme court which involves custody issues, call Diana Mohyi Attorney at Law P.C. Two heads are better than one.