Suppose you are getting divorced. During the marriage your husband or wife lost his or her job and received a severance package. Are you entitled to part of that money? According to the Nebraska Court of Appeals, the answer is yes.
In Malin v. Loynachan, 15 Neb. App. 706 (2007), a Nebraska appellate court addressed this issue for the first time. The Court of Appeals ruled that the portion of the severance package earned during the marriage is considered marital property. The Court also held that the spouse claiming that part or all of the severance package is nonmarital has the burden to prove so.
In Malin, 15 Neb. App. 706 (2007), the husband received a severance package that included $11,022.30 in vacation pay, $98,581.08 in severance pay, a bonus of approximately $1,390.60, and $5,000 in outsource assistance. The severance pay consisted of 1 month's salary per year of service. The husband had worked for the company a total of 88 months, and he was married to the wife for 68 months at the time left his job.
The Court first multiplied the amount of the severance package by 62%, in order to reflect the amount actually received after taxes (that is outrageous, by the way). The Court then multiplied that amount, $61,120.27, by 77.27%, to reflect the portion of the severance pay earned during the marriage (68 months divided by 88 months). The Court concluded that $44,227.63 of the severance pay was marital property. The Court also ruled that since the husband did not prove that the vacation pay, bonus pay and outsourcing assistance amounts were not marital property, the after-tax amounts of those items would also be included in the marital estate.
In Malin v. Loynachan, 15 Neb. App. 706 (2007), a Nebraska appellate court addressed this issue for the first time. The Court of Appeals ruled that the portion of the severance package earned during the marriage is considered marital property. The Court also held that the spouse claiming that part or all of the severance package is nonmarital has the burden to prove so.
In Malin, 15 Neb. App. 706 (2007), the husband received a severance package that included $11,022.30 in vacation pay, $98,581.08 in severance pay, a bonus of approximately $1,390.60, and $5,000 in outsource assistance. The severance pay consisted of 1 month's salary per year of service. The husband had worked for the company a total of 88 months, and he was married to the wife for 68 months at the time left his job.
The Court first multiplied the amount of the severance package by 62%, in order to reflect the amount actually received after taxes (that is outrageous, by the way). The Court then multiplied that amount, $61,120.27, by 77.27%, to reflect the portion of the severance pay earned during the marriage (68 months divided by 88 months). The Court concluded that $44,227.63 of the severance pay was marital property. The Court also ruled that since the husband did not prove that the vacation pay, bonus pay and outsourcing assistance amounts were not marital property, the after-tax amounts of those items would also be included in the marital estate.
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