separating finances: already have prenup
So I’ve seen this be a hot button item, separating finances, so here we go.
My husband and I have a prenup. I have my own business. He started a business with his brothers. We both work outside this business too. Our day jobs go into a joint account which funds the home and we file taxes jointly. Our businesses we keep separate.
Due to a glitch(we caught halfway through the year last year), my husband’s day job caused us to get a huge tax return which we normally don’t get and we like to break even. Now this is money we would have normally used to my joint expenses that now the tax return has gone into our joint account.
He told his brothers that he is getting a huge tax return and now they (and I think the bank too maybe) are pressuring him to use it to put into their business to help sustain and grow it larger. I am WAY against this. Yes, it is due to HIS day job income, but it was for our household joint account and household expenses. I believe this entitles me to a say in how it should be spent(mainly in putting it towards joint household expenses such as paying down the mortgage).
We have been arguing so long about it that we moved it from our joint checking to our joint savings until we can decide what to do with it. I am have not told him yet, but if he does not put what I am viewing as our “joint money” towards our joint household expenses and instead chooses to put it towards his business-which according to our prenup I am excluded out of- I am going to go completely separate.
I will get a separate checking account, separate savings account, pay bills separately, no longer manage the household bills or balance the household budget, and begin filing taxes married filing separately-which will mean less money for both of us.
But what choice will he leave me with? The prenup doesn’t say anything about how we handle tax refunds-because we have always been on the same page that we don’t want refunds we make it so we take home the most we can all year and never get a refund.
Am I totally out there in what I’m thinking? I feel a little guilty because it is HIS day job, but it is our joint account and our joint household expenses that this money WOULD have gone to had this glitch not happened and it come to us during the year instead of a lump sum during tax time.
If we break it down like that
If we break it down like that then yes, I paid more of my "share" because the government took more of his in taxes which would have gone into the joint account to pay bills. So my money, my share, was a larger portion because of it.
We have a verbal agreement that day jobs are in the joint account for joint household expenses and our businesses are to be self sustaining with profits going back into the business to keep them growing. Problem with my husband's business is he is just starting out. They are all in the red right now.... that is why he wants to take our joint money and put it into his business which we agreed was a no-no when we got married.
We do not have any kids togther.
Well, if you want specific
Well, if you want specific percentage wise I will break oit my calculator...
My husband's day job and mine typically make about the same having him contribute 52% of the income to our joint checking account and my day job contributing 48% to the same account. We pay all household bills and joint expenses out of this account.
Because of this error it made him contrinbute only 37% (instead of his 52%) and now he is asking for the 15% coming back in taxes to go to his business.
Entire year
Entire year
i guess i look at it that his
i guess i look at it that his business allows him to make the money that then allows him to utilize his day job income to help with the house.. so if his business does well, then that is just more of his day job income that can go towards your joint expenses/savings/future. its sort of a win-win.
But right now his business is
But right now his business is still in start up mode and has not generated any "real" income. His business is in big debt. He wants to use the money to borrow more (Thus why he is still working a day job and why we still have a mortgage needing to be paid off.)
Is the amount enough to do
Is the amount enough to do both. Can you split it and half goes towards paying down the mortgage and the other half goes towards his business?
^^^This
^^^This
What do you each do with your
What do you each do with your incomes from your businesses? Is his business in trouble if the bank is asking for more money? Is he throwing good money after bad by investing in it?Have you asked him what he would do with the money if his brothers and the bank weren't pressuring him to invest it the business?
If he does end up investing the money in his business I hope that he gets some legal acknowledgement of that or increase in his share in the business (unless his brothers invest the same amount). Or I suppose he could loan the money to the business and then the business could make payments back to him over a period of time at a modest interest rate with full paperwork to cover himself on this in case the business goes bankrupt. He could then arrange for that money to go towards your joint account.
Personally, I've been unemployed for the past couple of years so tax returns although we file jointly come from my husbands income. We usually do something nice together, save some and he spends some on something for himself (usually something electronic). I have friends who split their tax returns into 3 parts, they each get one part then the third part goes towards household things. I thought this was a good compromise.
If I were you I think I would ask that a small contribution be made towards the mortgage, and go for a nice dinner out or a weekend away so that you two can do something fun together and then let him spend the rest as he wishes (with the assurance that if it goes towards his business then his investment is protected in someway, as I said above).
If you do feel so strongly about him not investing in the business that you want to separate your finances from him, then I would let him know that before you two decide what to do so that he knows the consequences of using it for his business.
You reminded me of another
You reminded me of another good point.
I am the only wife who signed a prenup... the other wives co-signed the bank note and are co-owners of the business with their husbands(on paper but don't make any business decisons or work at the business). SO NO MATTER how much money each brother puts in each person is equal share!
B1-BW1 B2-BW2 H. =5 shares of the business
Anyone else able to do math? My husband is only 1/5 owner of a business between 3 brothers because 2 wives are apart of it!
So far they have not muscled their way in (one SIL is actually very nice-but one is a time bomb)
So, no. I do not want my husband to put MORE money into a business that he will not have MORE SHARE of if he does so, especialy when he already has LESS SHARE of it now...
The five way ownership would
The five way ownership would be a problem for me.
If one person is putting in substantial funds and the others are not than to me that's a problem.
I also wonder about the brother's wife's liability even if they are not part of the day to day business.
If it were me I would want to sit down with a lawyer who is well versed in business startups and be sure of the liability of each person in this venture. And to discuss the infusion of new money to this venture and how profits are to be distributed.
Personally I don't see how your husband's personal tax return has any relation to the business. The business has 5 owners and should have filed its own tax return (I would think).
The only reason there is a
The only reason there is a refund is because he was more deducted from his day job for taxes than he should have. Therefore the money belongs in the household account because that's where it would of been without his error.
As far as the business goes, he is getting the short end. If he is contributing 33% of the money but only owms a 20% share he was a fool to agree to that.
It is an LLC. (And since I'm
It is an LLC. (And since I'm not in the loop with it, I am only mentioning what I know.)
All three brothers started the business with equal money. But they all 5 have business loan with bank.
Each brother has been putting in more money since then-different amounts I don't know. -but probably why the pressure.
All 5 are listed on Llc paperwork as executives(or decision makers? Don't remember wording I'VE only seen them once).
Business was started with business loan backed with personal assests-why I signed prenup.
All three brothers make a very good living (but my opinion they want to grow too fast. And want to use debt to do it-another prenup reason).
What argument is he using for
What argument is he using for taking the tax refund for his business? I mean, this seems like a no brainer to me. "We agreed that all money from our day jobs going into our joint account. This money is from your day job. Case closed."
If he's legit arguing that at least some money from his day job *should* go towards his personal business, then what you have here is a renegotiation. "All right. Going forward we will both put $X in the joint account every month. All other monies may be used however we see fit." That still doesn't change the PAST though, so he still can't use the refund unless you guys agree to split what's currently in the joint account. You could, if you wanted, make that arrangement. "You may take the refund of $X and I will take a matching $X from our joint account for myself."
I don't know, from the way you describe it, I can't honestly understand his side of the argument. Day jobs = joint. Tax refund = day jobs = joint. Period, dot. Anything else is breach of contract.
It seemed so black and white
It seemed so black and white to me. That's why I wanted to post here. Everyone on here does a REALLY tgood job of telling like it is and seeing the other side... it's definitely not your mama in the corner stroking your hair saying "he's all bad and your all good shame on him"
The people on here really let you have it if there is even a remote chance thqt there is another side of the story you are not seeing.
Does he understand your
Does he understand your argument that the money under normal circumstances should go to the joint account? Or does he not understand the way the money came out and thinks that it is due to him personally? I am just wondering if his stance is that he doesn't understand the math of the situation? Or if it is that just sees a need in his business and that the extra money would be useful for that. If it is a case of the math, have a think about a different way you can show him the percentages etc or visualize it for him. Different people see math and numbers in different ways.
He does sound like he is in a tricky situation though, if his brothers have both put in extra money since they started the business and he hasn't, I could see the pressure for him to contribute too would be larger. But if his only source of income outside of the business is his day job and all of that money is to be spent jointly with you, he has no other income to put towards the business, unlike his brothers who presumably were able to agree with their wives that their joint money would be invested.
"He does sound like he is in
"He does sound like he is in a tricky situation though, if his brothers have both put in extra money since they started the business and he hasn't"
True, but in that case he needs to renegotiate with his brothers. If he owns 1/5 of the business, then he puts in 1/5 of the money. If, on the other hand, he puts in 1/3 of the money, then he needs to own 1/3 of the business.
But regardless of his arrangement with his brothers, he has a separate contract with his wife, the OP. In that agreement, they agreed that money from their day jobs goes into a joint account. He could make the argument that since their take home pay is slightly different, it would be more fair to just both contribute a set amount to the account every month. He really can't argue that he should pay 37% to her 63% because he has outside business requirements though. That's not fair.
If you guys decided that the
If you guys decided that the day job - and all things associated with it - is joint, then that's that. if he wants HIS HALF to reinvest in his business with his brothers, then fine, that's his choice. But then you get to take your cut and put into your own personal bank account to do with what you will.
Little known fact about my situation: my "husband" and I are no longer / never legally married (marriage outside US). We continue to co-habit exactly as if married but the tax situation is MUCH, MUCH better filing individual, not-married.
We also have separate everything and a joint account for joint expenses. Highly recommend. Works out for so many reasons. For example: no bickering about "frivolous" or "unnecessary" purchases. If that's what you want to do with your personal money, then go right ahead... as long as we are both putting in equal shares into the joint account. It's great for times like when he feels pressure/obligation to pay his adult daughter's outrageous car insurance - because she's a horrible driver - because he feels bad that she can't get to work. "Oh, okay. If that's what you want to do. I don't think I would do that". And, voila! It's all on him to decide if he really wants to take that hit to his personal account and I don't have to feel bitter because it's money he's NOT spending on joint expenses that i then have to pick up the slack for!!!!! (as in the past)
I like it SO MUCH BETTER, I cannot tell you.
Literally, the mental "noise" and anger that used to rage inside of me has all but dissipated.
Thank you! I need to read
Thank you! I need to read over my prenup and the exact wording.
What exactly it says about his and my business and what can and can't be done with the funds involved, what is considered "joint assets".
Maybe I should go talk to my lawyer, (a quick 30min conversation might be worth it to have her explain the wording qnd legalities to me.)
Thanks for that comment!
were you ever offered to be
were you ever offered to be included in the business? seems weird that the other wives were but not you, unless you chose not to be.
also, how did no one notice that your husband's checks were smaller all year due to too many taxes being taken out?
I was offered to be included.
I was offered to be included. I said no- I operate my business debt free. He and his brothers were talking about doing this business when we were dating and when I said "no debt, start small, grow slow" they said "that's not possible" and I said "then count me out. I don't want the bank coming after my well established business if your business fails"
So my husband's home (we built while dating and engaged ) is solely in his name and still has a mortgage-because I won't pay it off.
He wanted to join a business with his brothers in debt more than he wanted my money. His choice.
He was overseeing the joint account paying joint bills with our "day jobs" going direct deposit. He was not paying attention to how big his checks were. It wasn't until I went to withdraw money and the account was overdrawn. I took over the account then and the bill paying.
I don't see his pay stubs but
I don't see his pay stubs but I saw the tax return. So I could do the math with how was supposed to go into the account, how much actually did, what was taken out in taxes, and so forth.
And I think he really was that "dumb" because if he was really trying to hide it he would have been watching the bank account closer so it didn't overdraw and would have put up more of a fight when I said -how about I take over the account.
I did take his word for it that it was his company's error on the tax form in entering it electronically that they were taking out a flat amount from his check instead of the deductions they were supposed to be.
I am talking to him about it all this weekend. The kids are gone. I've looked over the prenup but my lawyer did not have any openings this week to talk to me. I'm going to see what my husband says about it. How dead set he is about it. Then if need be I can visit my lawyer next week and see what to do to further protect myself and see if he takes this money if it will void the prenup.
I think brothers are almost
I think brothers are almost as much of a pain as step kids and BM's. My DH's brother lives in my house and spends his days watching t.v., panning for gold, fishing, and basically NOT looking or a job like he was supposed to. UGH!
But, I would still rather have him there than the stupid skids. It's always a good excuse to tell them no when they call and ask. We can just say, no, sorry, couch is already taken.