Going through a divorce can be costly. For starters, couples can no longer benefit from the economy of shared resources. Instead of one health insurance plan, couples may have to get separate coverage when they begin their new lives apart. Household costs must also be borne separately when a couple is no longer under the same roof.
According to a recent article, an individual's cost of living is more likely to increase after a divorce. As the housing market continues its upsurge, couples going through a divorce need a skilled attorney to help them obtain an equitable division of property and plan for their financial future.
That proactive approach requires a thorough investigation of the marital estate's assets and liabilities. Tax returns, statements from retirement accounts and securities, and any creditor mailings can help fill in pieces of the puzzle.
Our law firm can also help an individual put his or her post-divorce tax obligations in perspective. For example, there may be a big difference between securities in an after-tax investment account, versus a deferred retirement account. Even if the dollar amount in both accounts is the same, the impact will be different for whichever spouse is awarded the tax-deferred account. Said another way, a court might agree that such an approach would not constitute equitable distribution.
Similarly, hidden tax implications may be in store for a spouse that inherits an asset with a low basis. Check out our firm's website to learn more about how we can help you plan for the tax implications of divorce more wisely. We can address immediate problems while keeping an eye toward your long-range interests.
Source: Wall Street Journal, "Divorce and Money: Six Costly Mistakes," Veronica Dagher, May 15, 2015