TIMING OF DIVORCE IN PREPARATION FOR COLLEGE

As couples with teenage children are considering divorce,  one of the things to think about is the timing of the divorce.  We have always considered the timing of divorce as this impacts the parties’ ability to file a joint income tax return.  However, I had never considered how this might impact their children’s ability to get financial aid.  I recently came across a post from Robert Bordett, a Certified Financial Planner and Certified Divorce Financial Analyst in Georgia, in which he shares some information he learned about the timing of divorce and its impact on financial aid. http://www.familyaffaires.com/co-parenting-work-together-divorce/.

A collaborative divorce process allows the family to consider all factors associated with their divorce, including the timing.  As Mr. Bordett explains, the timing of the divorce can be crucial to the child’s ability to get financial aid.  This is because the income that is considered on the FAFSA (Free Application for Federal Student Aid) form is the parent’s income for the year prior to the start of college.  If a couple’s divorce is final in January of 2015 and the child starts college in September of 2015, the information from the joint tax return must be used for the FAFSA form.  If the divorce is final in December of 2014, then the information from the primary residential parent’s tax return can be used instead.  If the primary residential parent is the lower wage earner, this can make a significant difference on the amount of financial aid the child receives.  

This is just one of many reasons that the Collaborative divorce process makes sense.  It provides the necessary information and flexibility to enable parties to consider things like the timing of their divorce. 

PERSONAL INJURY SERIES: HAVING A LIEN ON YOUR SETTLEMENT OR JUDGMENT ON AN INJURY CASE

                When a person gets injured, the last thing they are thinking about is how the various insurances interplay with one another. The first thing that should always be focused on is getting the necessary medical treatment. At our firm, we have a textured knowledge of insurance law and how each policy affects the other and we can unwind the confusing mess that a personal injury claim becomes. This allows our clients to focus on the treatment they are receiving, while we focus on getting the right insurance to pay for our client’s medical bills.

                There are three basic sources for payment of medical bills. The first is obvious, and it the health insurance for our clients. The second is no fault coverage, and not everyone is aware that this provision in your automobile policy covers medical bills from an accident. This takes the form of “medical payments coverage” in New Hampshire, and “personal injury protection (PIP)” in Massachusetts. Our attorneys are very familiar with both types of insurance, and can help utilize these sources to reduce your obligations at the end of the case.

                If your health insurance pays bills, then the health insurer has a right of recovery against our client’s settlement or judgment called a “subrogation” right. Often, the health insurer will send our office a notice requesting a lien on the file. This is due to the fact that a person injured in an accident is not allowed to get a “double recovery”. This would be where health insurance pays a bill, and then the client takes a settlement that includes compensation for those bills but does not pay the health insurer back. This right of subrogation by a health insurer is a contractual right included in the health insurance policy. Accordingly, it almost always must be paid back.

                If a client has Medicare, Medicaid or Tricare (a/k/a “military”) insurance, then each has a statutory right to be paid back from a settlement or judgment our clients secure. This is based on the same “double recovery” principle, except the rules are much stricter and coordination of benefits becomes very important. Medicare, especially, can create significant delays in resolving these subrogation liens, so it is always important to talk to an attorney about your rights in your case.

                There are other forms of liens in Massachusetts, including statutory hospital liens. In all cases, the interplay of the various insurances involved become very important to coordinate. For example, the medical payment coverage referenced above does not include any subrogation rights. This means that if your medical payment portion of your policy pays a bill, then they cannot recover that payment from the settlement or judgment. Thus, it becomes very important to find an attorney with a detailed knowledge of the insurance rules and how liens on injury files work.

                Personal injury cases are complex and require the assistance of experienced attorneys to help you navigate the various pitfalls and maximize the value of your case. If you were injured and need assistance, contact our office today and put our decades of experience to use.