Divorce Newsletters

Avoiding Some Unwelcome Tax Surprises

February 1, 2015

Surprises are nice on your birthday, Christmas and April Fools’ Day. But they are not so welcome when you find out, post-divorce, that they result in a hefty tax bill. A pre-tax settlement can look very different from a post-tax settlement if consideration is not given to such issues as cost basis and depreciation. You can help your client make wise decisions by keeping some tax issues in mind during the divorce proceedings.

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Protecting Credit During a Divorce

January 1, 2015

When you are helping your client navigate through the divorce process, it is important to take steps to protect their credit score. After the divorce is completed the client’s financial future will be impacted by this number, affecting their ability to take out a mortgage, secure an auto loan, and perhaps even to rent an apartment. Some employers are looking at credit scores as a gauge of the person’s integrity. Here are some tips you can give your client to help them preserve their good credit history.

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Splitting Annuities in a Divorce

December 1, 2014

It is not unusual, when splitting assets in a divorce, to divide each account right down the middle. That might be fine to do for most types of investment accounts, but when it comes to annuities you need to be very careful. Because of their unique structure, dividing an annuity can have unexpected tax consequences.

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Using Life Insurance in a Divorce Settlement

November 1, 2014

Life insurance is traditionally purchased to cover the risk that one spouse in a marriage will die and leave the surviving spouse unable to support his or herself. When the couple divorces you might think this risk no longer exists, as the two parties are no longer dependent on one another. However there are several reasons why life insurance may still be necessary, and this brings up a host of issues.

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Social Security Choices for Divorcees

October 1, 2014

Most likely, as you work out a settlement for your divorce clients, you are making an attempt to figure out whether the assets and income your client will have post-divorce is sufficient for his or her needs. Depending on the age of the client this exercise might have you looking just a few years ahead (for young clients) or right through retirement (for older clients.) For your clients who are approaching retirement age, factoring their Social Security benefit into the picture is important.

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What Can We Learn From a Tax Return

September 1, 2014

The tax return is a valuable tool in divorce. It contains a variety of information that helps us find or verify financial data. Here aresome examples of how to mine the federal tax return:

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What To Do When Refinancing Is Not An Option

August 1, 2014

When a divorcing couple owns a home together, one of the spouses will be awarded the house and must then assume the mortgage singly. The names on the existing mortgage cannot be changed, and the assuming spouse must therefore refinance to take on the remaining mortgage balance. What happens when the spouse who wants to remain in the marital home will not qualify to refinance the mortgage?

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Gray Divorces

July 1, 2014

There is no formal definition of a “gray divorce” or, as it is otherwise known, a “late in life divorce” but these terms are commonly used to describe divorces involving couples in their 50’s or older. Personally I feel “late in life” is a misnomer as a 50-year-old could easily live another 30-40 years, and I think sometimes a better description would be “late in work life” divorce. Because many of the issues that are particular to older divorcing couples stem from the fact that neither party has more than 10-15 years at the most to make up for lost income or assets, and that is only if they are still working. If one or both parties are retired, the opportunity to regain the pre-divorce lifestyle becomes even more difficult.

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Converting a Rental Property to a Personal Residence

June 1, 2014

When a divorcing couple has two properties the separation can be made easier when one party takes the principal residence and the other takes the vacation home. This may seem like a cut and dried decision, but there is an important tax issue to consider when converting a rental property to a personal residence.

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Investment Costs Can Impact a Property Division

May 1, 2014

Remember the old adage “never judge a book by its cover?” This holds true when looking at the value of a taxable investment asset. It can look like one thing on the outside, but can turn out to be completely different on the inside.

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