Why a Do It Yourself Divorce Will Actually Cost You

Divorce can be a difficult, painful, and sometimes expensive process. How people go through a divorce can make it less painful, but people may try to save money by doing it themselves. While a do-it-yourself divorce is entirely possible under Minnesota law, it comes with more risks than many people realize. Even if you believe that your divorce will be a simple matter of dividing up some assets and preparing some paperwork, you may overlook something that will cost you more money down the road than you would have spent on a divorce lawyer.

Keep in mind that hiring a lawyer for a divorce does not have to be an all-or-nothing deal. You can hire an attorney to handle only part of your case. Louise Livesay is a Minnesota family attorney who offers multiple types of legal representation in divorce cases. She can assist you with a pre-divorce consultation, advise you about the divorce process so you can handle a DIY divorce better, or prepare documents to finalize your divorce after you and your spouse work out an agreement.

Read on to learn about possible pitfalls that you may encounter in a DIY divorce without legal representation.

Following Minnesota’s Legal Requirements for Divorce

Every state has its own laws dealing with divorce, child custody, and other family law matters. While commonalities exist among most states, there are many important differences. This is relevant to DIY divorces because many people try to learn about the divorce process online, and they end up with only a partial understanding of their own state’s laws. When they try to file paperwork with the court, the clerk or the judge might not accept one or more documents because they are missing something that state law requires.

The law requires divorce paperwork to include a large amount of specific information. Even a divorce with no children and little property must cover numerous issues, including the court’s jurisdiction to grant a divorce, the grounds for the divorce under state law, and enough information to allow the parties to divide what property they have once the divorce is complete.

Trying to represent oneself in a divorce hearing or trial can lead to even larger problems. In addition to knowing about the formal requirements of divorce paperwork, a court proceeding requires knowledge of rules governing procedure, evidence, decorum, and other matters.

Dividing Large or Complicated Assets

The division of marital property often requires much more than a statement of who gets which items. Some assets are very difficult to divide, even when the parties are in agreement about what they want to do. Two examples, out of many, are retirement accounts and real estate and the Judgment & Decree does not make the transfer complete.

Retirement accounts are subject to various state and federal laws that govern matters like how and when beneficiaries may receive payments. Dividing a retirement account between divorcing spouses often requires a separate order from the court, known as a qualified domestic relations order (QDRO). This order must conform not only with federal and state law, but also with the plan administrator’s own requirements. An improper QDRO signed by a state judge could still be rejected by the plan administrator, or it could cause unintended tax consequences for the parties. If this step is not completed there will be no actual division and years later you may have a mess on your hands because your spouse may have rolled over the account to another retirement asset or withdrawn money, for example, before you realize you don’t have access to it without the additional step.

A home buyout can also cause unexpected problems in a DIY divorce. One party to a divorce may want to keep the house where they both lived, and which they own jointly. Buying the other party out, or agreeing to a buyout, requires careful planning. The party receiving the payout could end up owing capital gains tax, depending on how much the house’s value has increased since they bought it. The party who is keeping it may have to obtain a refinance loan if the mortgage is in both parties’ names, which could mean losing a good interest rate. If you continue to own it jointly or award it to one person, title needs to be recorded and a possible lien as well to protect any unpaid funds.

Overlooking Tax Consequences

Unintended capital gains taxes are a potential risk with many assets besides the marital residence. In a DIY divorce, the parties could be so focused on sorting through their assets that they do not plan or account for how the IRS will view what they are doing. This part of the process can be very well-suited for the Collaborative law process since it typically includes a financial professional who can guide the parties through the asset division process. Making clear how taxes are handled with regard to children is also critical to avoid future problems.

Making Sure You Provide for the Children

In any Minnesota divorce involving minor children, the final divorce decree must include provisions for custody of the children, parenting time, and child support. All of these provisions must, in a court’s judgment, be in the children’s best interests.

The child custody portion of a divorce decree must contain a rather vast amount of information. It must:

• Define who has rights to care for the children and make important decisions for them;
• Identify situations when the parents must consult with one another before making major decisions;
• Provide a visitation schedule that takes the children’s needs into account; and
• Establish procedures that the parents can use to resolve the disputes that will almost certainly arise.

Perhaps above all else, these provisions of the decree must allow for the fact that children’s needs will change as they get older. If a judge does not reject the decree outright for lacking any of this information, it may prove to be unworkable soon after the divorce, requiring the parties to go back and try again. None of these issues relating to children can be waived.

Underestimating the Emotional Toll of Divorce

As mentioned above, divorce is an emotionally painful process. Making important decisions during an ordeal like this can be especially hard. A person who tries to handle a DIY divorce without taking the emotional cost into account may make mistakes that will cost them later. They may forget about important issues or make concessions or demands that they will regret. A compassionate legal advocate can help them avoid such errors and costs, emotional and financial, down the road.

For more than twenty years, family attorney Louise Livesay has helped families in the Twin Cities area resolve disputes arising from divorce, child custody disputes, and other difficult issues. She believes in using Minnesota’s family laws to guide clients in transforming their relationships. If you have questions about divorce mediation or Collaborative law, please contact us today online or at (651) 294-2338.

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