High Asset Divorce Archives

Divorce and financial assets

Couples in Texas who get a divorce should understand the tax ramifications of the dividing their financial assets and take care to follow the correct procedure when dividing certain types of assets. For example, for divorcing couples who want to split a workplace retirement plan, it will be necessary to obtain a qualified domestic relations order, a legal document that details how much of the employer-sponsored retirement benefits of one spouse will be given to the other spouse.

Divorce mediation can help to preserve privacy

Divorce is always a legal process that dissolves a marital relationship. However, some Texas couples may wish to avoid the expense and complications associated with extensive litigation. For these divorcing couples, divorce mediation can be an alternative to traditional litigation. It makes use of a third-party mediator, along with the lawyers of both spouses, to sort out key issues and arrive at a mutually acceptable and beneficial agreement. For divorces that involve child custody, mediation can often be court-ordered.

Divorce and pitfalls in dividing retirement accounts

Texas couples who are getting a divorce and who need to split a 401(k) or another type of pension plan will need a court order called a qualified domestic relations order. This document, which should be prepared by an attorney and must be approved by the plan administrator, is necessary for making a distribution from these types of accounts without having to pay taxes or penalties.

Divorcing couples need to do financial homework

The Boy Scouts' motto, 'be prepared," is a phrase that also could be applied to older Texas couples who are contemplating a divorce. The closer Baby Boomers get to retirement, the more likely many of them are to get divorced since the divorce rate for the over-50 crowd is on the increase.

Dividing art collections in a divorce

When some couples in Texas get a divorce, they might have artwork to divide. There have been several high-profile divorces in which artwork created conflict during property division. For example, in a divorce between a real estate developer and his wife, a trustee of the Guggenheim and the Metropolitan Museum of Art, artwork by Picasso, Warhol and others were among those in dispute. One issue was the appraisal of the art's value, which differed by hundreds of millions of dollars. Another was figuring out who had paid for the art.

Tax changes that happen after divorce

Texas couples should be aware that after getting a divorce, their tax situation will change as well. If the divorce occurred on or before the final day of the calendar year, people will not be considered married for that year. If the marriage is annulled, it will also be necessary to file amended returns for all the years of the marriage since legally speaking, the couple is no longer considered to have been married.

The requirements for an alimony tax deduction

When Texas couples are ending their marriage, they should consider the possible tax consequences before executing a settlement agreement. A case decided in U.S. Tax Court illustrated the importance of documenting all spousal support payments within a legal agreement in order to receive a tax deduction for the expense.