Like most people, I give my taxes passing thoughts here and there during tax season. Yesterday was one of those days because I was working on my business tax return. However, in my work as a divorce mediator I ask every client I see about their taxes, no matter the time of year.
Taxes are just one of the many important financial areas you have to consider when creating a divorce agreement. The issue of taxes pops up all over the agreement. Spousal support (alimony) is taxable to the person receiving the payment and tax deductible to the person paying it. Who is claiming the children as dependents on his/her tax return once you are divorced and filing separately? Are you selling your house together as a married couple or afterwards as a divorced single person? There are greater tax savings as a couple. What happens if 2 years from now, when you are divorced, you get audited for the tax year from 5 years ago when you were still married? Who pays for what? You can divide a retirement account without any penalties or tax burden when divorcing.
At Westfield Mediation, LLC, we suggest to every client that each party reviews his/her divorce agreement with a tax professional before signing off on the final agreement. You don’t want to agree to a certain division of assets and then have to pay a tax 8 years from now that you did not know was associated with assuming that asset. A tax professional is up-to-date on the latest tax law changes and can best advise you on the most cost-efficient answers to the many tax questions. Westfield Mediation, LLC, has a list of divorce knowledgeable tax professionals in the area if you do not have a personal accountant to help you with this vital piece of the divorce puzzle. When you are getting a divorce the issues of taxes comes up any time of the year, not just at tax time.
For more information about divorce mediation contact Randi M. Albert, JD, or Michelle Weinberg, LMFT, at Westfield Mediation, LLC, at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at [email protected].
Taxes are just one of the many important financial areas you have to consider when creating a divorce agreement. The issue of taxes pops up all over the agreement. Spousal support (alimony) is taxable to the person receiving the payment and tax deductible to the person paying it. Who is claiming the children as dependents on his/her tax return once you are divorced and filing separately? Are you selling your house together as a married couple or afterwards as a divorced single person? There are greater tax savings as a couple. What happens if 2 years from now, when you are divorced, you get audited for the tax year from 5 years ago when you were still married? Who pays for what? You can divide a retirement account without any penalties or tax burden when divorcing.
At Westfield Mediation, LLC, we suggest to every client that each party reviews his/her divorce agreement with a tax professional before signing off on the final agreement. You don’t want to agree to a certain division of assets and then have to pay a tax 8 years from now that you did not know was associated with assuming that asset. A tax professional is up-to-date on the latest tax law changes and can best advise you on the most cost-efficient answers to the many tax questions. Westfield Mediation, LLC, has a list of divorce knowledgeable tax professionals in the area if you do not have a personal accountant to help you with this vital piece of the divorce puzzle. When you are getting a divorce the issues of taxes comes up any time of the year, not just at tax time.
For more information about divorce mediation contact Randi M. Albert, JD, or Michelle Weinberg, LMFT, at Westfield Mediation, LLC, at 908.913.0373. View our website at www.westfieldnjmediation.com or email us at [email protected].
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