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Tuesday, November 27, 2012

Retirement - You Gotta Share It!

You slave away from 8-5 daily, almost 52 weeks a year at your job.  You put up with your coworkers, boss and the fact that the maintenance staff never seems to empty your trash can and vacuums around all the crumbs you left on the floor.  The only good thing your job has going for it is a great pension and 401k plan (although it’s probably one or the other in today’s economy), and you can’t wait to be able to sit back, relax and collect all that money each month.

Because your wife never seems to pick up after you either, you decide that it is time to file for a divorce – you want to live out your glory years on a beach with some young babe, and having a wife would foil those plans.  But when you walk into your local divorce attorney’s office for a consult, he says something that stops you dead in the middle of that daydream – your wife gets part of your retirement?!?  She has her own job, she has her own retirement, and she didn’t put in all that time at your employer!

Here’s the kicker – per MCL 552.18, “any rights in and to vested pension, annuity, or retirement benefits, or accumulated contributions in any pension, annuity, or retirement system, payable to or on behalf of a party on account of service credit accrued by the party during marriage shall be considered part of the marital estate subject to award by the court.”  And, any rights in an unvested retirement plan where you accrued those benefits during the marriage may be subject to division as well. 

The good news is, if your retirement is up for grabs, so is hers.  Typically, barring any premarital amounts in the retirement plan, each spouse is entitled to one-half of the other’s retirement benefits that were accumulated during the marriage (date of marriage to date of divorce).  If you worked at your employer’s prior to the blessed wedding, you most likely get to keep those funds and you’ll need to find out exactly what you had in your 401k or other plan at the date of marriage (or as close to it as the plan administrator can get) so that the premarital amount can be excluded.  Anything you earn after the divorce is yours to keep too, but your spouse can sometimes share in things like cost of living increases to the extent of her award.  Technically the courts can divide premarital and post-divorce monies too, but I rarely see this happen.

If the parties both have the same type of plan, it’s easy to divide – you simply take who has the larger amount, subtract the smaller amount, and split the difference.  At times the one spouse’s award can easily be rolled over into the other’s account by filling out paperwork and submitting it to the plan administrator.  In more complex situations, specific formulas are used to divide plans and determine your spouse’s exact monthly benefit.

The court documents used to divide most retirement plans are called a QDRO (Qualified Domestic Relations Order) and an EDRO (Eligible Domestic Relations Order).  Depending on your employer and type of plan, one of these will be used (unless you got lucky and could just roll it over without needing a separate order).  If your attorney is comfortable drafting these documents, he or she may prepare the QDRO or EDRO on his or her own, or if it’s more complex, it may be farmed out to companies that do this as their primary business.  Certain plans are a nightmare to work with and every comma has to be in the right place in order for the plan administrator to approve the order.  When I know that a large headache is in store, I will hire a company to draft the order – there are several well respected companies in Michigan that know the QDRO and EDRO game inside and out.

I like to send in my orders for “pre-approval” by the company first so I know whether or not it will be accepted before I obtain everyone’s signatures and enter it with the court.  If you don’t secure pre-approval, you run the risk of entering it with the court, submitting it to the company, and then being told it’s wrong and won’t be accepted.  At that point you have to draft an amended QDRO or EDRO, secure all the signatures again, enter it with the court again, and hope the company accepts it on the second try.  Getting a yes or no before doing all that work can alleviate a headache in the end, and save your clients money as well.

You and your spouse can agree to keep your own retirement and not share in those benefits, but that doesn’t happen too often – she needs that extra monthly income for fun with her new man too.

Saturday, November 3, 2012

Erasing your crime

Occasionally we all do something that we regret and we look back and wish it could be erased from the memory of those who witnessed it.  Past criminal acts certainly fit into this category, and if you meet certain qualifications, those acts can disappear from the public’s eye.

If you’re looking to set aside a criminal conviction, also called an “expungement,” the State Court Administrator’s Office (SCAO) has a great packet which includes eligibility questions, instructions and forms to help you do this.  The forms you will need are MC 227 (Application to Set Aside Conviction) and MC 228 (Order on Application to Set Aside Conviction).  I can’t explain everything in my article, so obtaining this packet will give you extensive details and instructions as to what to do, and the great internet will provide you with the packet at the click of a button!

In order to be eligible to set your conviction aside, you must only have ONE conviction in your past, not including two minor offenses, as set forth in MCL 780.621(10)(b).  If you have a conviction from a federal court or another state, you’re not going to be able to apply.  The type of crime committed also makes a difference – for example, you cannot have been convicted of CSC (Criminal Sexual Conduct) in the first, second, or third degree, nor can you apply if you were convicted of an assault with intent to commit a CSC crime.  Being convicted of a felony or an attempt to commit a felony, where the potential max sentence is life behind bars, will bar you from an expungement as well.  Wanting to erase a driving or traffic offense is also a no go, and it must be at least five years from the date of your conviction and if you were thrown behind bars, at least five years after you were released from the clink.

If you don't fall into one of the categories above that exclude you from applying to set your conviction aside, you can likely get 'er done.  Now you have a little to do list in order to set this in motion.  You first need to obtain a certified copy of your conviction, which is relatively easy as you simply need to go to the clerk’s office and obtain a certified copy of the Judgment of Sentence, Order of Probation or Register of Actions in your case.  You will be charged a fee for this document, so bring some loot with you to pay up. 

Your next step is heading to a local police department for some fun finger painting – I mean finger printing.  The department will likely charge you a fee for this, but it’s usually not too bad.  Not surprisingly, the State Police will be checking on you and using these prints to determine if you have other convictions.  You’d be amazed at how many people claim to have forgotten about prior convictions or say they didn’t know they had them.

Once you have your certified copy and fingerprints, you need to sit down and fill out form MC 227 carefully and make the appropriate number of copies (all explained in the handy packet).  You must sign this form in front of a notary public or court clerk, file your application, paying another fee ($50 this time) and mail it out to the appropriate parties (prosecutor, Attorney General and State Police).  You’ve got to file a Proof of Service with the court to prove that you served the docs on the above parties.

It’s wise to wait to set your hearing until you have received your Michigan State Police background check report – usually it’s safe to say 6-8 weeks from when you file your application as the police can take time to process your request.

Be aware that both the prosecutor and Attorney General may attend and object to your application, and the victims of certain crimes can also appear as the prosecutor has to notify them of your application.  The court will make the ultimate decision as to whether or not your application should be granted, which is why you need to bring form MC 228, the Order on Application to Set Aside Conviction, with you to the hearing.  If the State Police report came back indicating no other crimes and the prosecutor and Attorney General have not objected to your application, there’s a good chance you’re going to get your wish.  If there are objections, you may still have your conviction set aside provided you have good evidence of how you have changed and a good argument as to why this should occur.

The court clerk should send the copy of the order to the appropriate parties, but I’d suggest making sure this happens, and if your application was granted, check your record to verify that your conviction no longer appears.  Again, do realize that the State Police will still keep a nonpublic record of your conviction, but to the public, it will look as though it never happened.

Here's the links to the packet and forms-