| Over 50% of married couples re-join the ranks of | | | | property assets may lead to unsuspected imbalances. |
| the un-married. Love, and relationship building, may be | | | | So, what do couples need to know? The handy |
| fickle stuff. But, it's pale soup compared to the dark | | | | certified divorce financial planner will advise that |
| complexities of asset carve-outs and divorce | | | | couples need a Qualified Domestic Relations |
| settlements when matters of money, tax and law | | | | order...ordered by a court of competent jurisdiction |
| intersect. Possibility for mistakes? Absolutely, unless | | | | and approved by the named employer. And what |
| couples hire an expert form the emerging class of | | | | does this QDRO court order do? This court order |
| certified divorce financial analysts. Getting married is | | | | creates the rules for making transfers to an IRA |
| like a stroll in the rose garden. | | | | account...or making early withdrawals under age 59 |
| Getting a divorce is an open "minefield" of dangers to | | | | ½ without the customary 10% penalty tax, |
| know about. | | | | albeit with ordinary income tax imposed on the |
| Divorce Minefield #1 - The Family Home. "You take | | | | withdrawal. Advice? Get the QDRO court document |
| the home...I'll take the bank accounts, the 401.K and | | | | ASAP and prior to the divorce in order to lock-in |
| the kids...50-50 split, OK?" Hold on. What looks like a | | | | benefits. Your divorced financial advisor will point out |
| ledger balance may contain some lurking tax issues | | | | that this detail, the QDRO, only applies to 401.K |
| which a divorce specialist financial advisor needs to | | | | portfolio accounts...transfers between IRA account |
| identify. A divorce decree may be the "end of the | | | | occur without penalty tax. |
| road" position, but couples may wait for much of a | | | | Divorce Minefield #3 - Who Gets The Kids...And The |
| year before a judge rules. Meanwhile, older appraisals | | | | Tax Breaks? A simple question. But, huge drama and |
| of the family home may be completely out-of-line | | | | emotional complexity when parceling out kids and |
| with either rises or declines in the local property | | | | future lives, designated spousal visitation rights and |
| market values. | | | | so on. Yet, the rules for expense deductions are |
| * What The Certified Divorce Financial Planner | | | | clear: only one (1) parent, the legal guardian, can take |
| Advises. Fluid values, like the housing and stock | | | | deductions for the kids as "dependents" on the |
| markets, mean that you and your financial | | | | annual tax returns. |
| investment management advisor need to consider | | | | Divorce Minefield #4 - Alimony Payments. The |
| (a). whether to sell the house while you're still married | | | | flip-flop nature of the tax code reveals itself, as the |
| in order to fully shield you from capital gains taxes | | | | certified divorce financial analyst will point out. The |
| or... | | | | party "paying" alimony can deduct the payments. |
| (b). re-title the house in your name...but introduce | | | | However, the party "receiving" alimony payments |
| restrictive covenants or terms and conditions within | | | | must report the incoming payments as ordinary |
| the divorce decree to shield a future home sale from | | | | income, and pay tax. "Fair is fair" coming from an |
| capital gains tax liability. | | | | emotional roller coaster divorce action is not a |
| Divorce Minefield #2 - Market Investments, 401.K | | | | defensible argument when it comes to facing the tax |
| Retirement Accounts. Getting into the numbers, and | | | | man. |
| knowing what to look for, is the meat-and-gravy diet | | | | * Hot Tip For Keeping The Alimony Payments |
| of certified divorce financial analysts. | | | | Flowing. Your divorce financial advisor will recommend |
| * Stock Portfolios. A stock portfolio, in real time, is a | | | | that the "alimony receiving" spouse take out a simple |
| composition in value. Dividing a stock portfolio, as a | | | | term life insurance policy on her ex...creating a |
| divorce investment management analyst will point | | | | back-up that future payments will be delivered, even |
| out, requires stopping trading activity and then doing | | | | if the paying spouse dies. |
| a trade-by-trade analysis for losses and/or capital | | | | Divorce Minefield #5 - Wills And Trusts. Nothing fouls |
| gains tax liabilities in order to determine a true, fair | | | | the divorce works better than out-dated wills and |
| and current portfolio value. And what about valuing | | | | trust documents. Advice? Correct and refresh all |
| hedge funds and their portfolios of private equity | | | | family estate documents, by having your certified |
| companies, mutual funds and the slippery-slope of | | | | divorce financial analyst meet with local competent |
| stock-options? Any and all financial assets have to be | | | | estate and divorce lawyers. |
| wrung-out of their market activity focus and | | | | Bottom line: Discover "divorce made easier...and |
| examined for net present value. | | | | smarter" via the new breed of certified divorce |
| 401.K Employer Funded Retirement Accounts. | | | | financial planners. Please go to the following links for |
| Determining future values of the tax-deferred 401.K | | | | up-to-date information. |
| plans...and then comparing those values with real | | | | |