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The Importance of Planning in a High Asset Divorce

Posted on in High Asset Divorce

TX divorce lawyerAlthough some couples quickly follow up the decision to end their marriage with a divorce filing, it is also not uncommon for couples to carefully consider this option over a period of weeks or months before officially filing for divorce. Those who take the latter route have the benefit of extra time in which to plan for the termination of their marriage, which can make all the difference in how smoothly the later divorce actually proceeds. This is especially true for couples who have unique or particularly valuable assets, as accounting for, appraising, and ultimately dividing these assets can take a significant amount of time. To learn more about how an experienced high asset divorce attorney can help you plan for your own pending divorce, please contact our legal team today.

Planning for Alimony

As a result of changes made to the tax code last year, divorced spouses who pay alimony are no longer permitted to deduct those payments come tax season, while spouses who receive these payments can no longer count those payments as income. Knowing how, and planning for, these changes will affect a couple’s own financial situation after divorce is important to the success of the negotiation process. For instance, divorcing couples who properly plan before litigating a divorce could redistribute their assets in such a way that they are able to regain some of what they will lose as a result of the new alimony legislation. The spouse, for example, who is the higher earner could retain the couple’s taxable assets, such as cash, stocks, and bonds, while the lesser earning spouse could retain the tax-deferred accounts like 401(ks) and IRAs.

Accounting for and Appraising Assets

Couples who own extensive, unique or especially valuable assets usually have a more difficult time accounting for, characterizing, and appraising all of those assets. Beginning this process ahead of time can help couples avoid some of the stress that goes along with dividing up a marital estate. Hiring a forensic accountant and other financial specialists can also play a crucial role in ensuring that no assets are improperly appraised or are unaccounted for during the property division process. Compiling documentation related to ownership and value can also be accomplished in the planning stage, which can save time later on in the proceedings.

Determining the Fate of the Family Home

Deciding who will retain the family home is another important task that high asset couples can undertake during the pre-divorce planning stage. This is especially important for couples who share children, as it is often in a child’s best interests to stay in the family home, at least while the divorce is pending. This may also require, however, that couples start calculating what household-related expenses will need to be covered during this time.

An Experienced High Asset Divorce Lawyer in Austin, TX

For help navigating your own high asset divorce, including the pre-divorce planning process, please call 512-610-6199 to speak with the dedicated Austin, Texas high asset divorce lawyers at Powers and Kerr, PLLC today.

 

Source:

https://www.forbes.com/sites/nextavenue/2018/12/04/how-the-tax-laws-for-divorce-will-turn-upside-down-in-2019/#5e86e46630fd

 

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