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Not all assets are equal in divorce

Now that you and your spouse have had an important talk about the state of your marriage, you both have decided that it is best for you to go your separate ways and divorce. As heart-wrenching as this decision seems, you know it must happen so you both can move on with your lives in Rockledge. 

You may think that you can speed things up and resolve your divorce by splitting things in half equally. However, not all marital assets are equal. You should carefully review every possible outcome to ensure that you are not getting an unfavorable settlement. Here are some things for you to consider when negotiating your divorce. 

Is the marital house worth keeping?

If your ex-spouse is offering you the house in exchange for financial assets, such as bank and retirement accounts, you may want to look twice as hard at his or her offer. On the surface, it may seem like a good exchange that can benefit your post-divorce. However, if you cannot comfortably afford to maintain the property and pay the taxes and mortgage note, you should decline the offer. 

Is the 401k worth having? 

No matter the results of your divorce settlement, your tax situation is going to change. You will be filing as head of household instead of married. Also, if you accept your spouse’s 401k as a part of your settlement instead of bank accounts, every withdrawal you make from it is subject to tax. This means you are getting less than you technically agreed to. If your spouse’s retirement plan qualifies for a QDRO (qualified domestic relations order), it can help you avoid the tax penalty. A QDRO is not automatically given; you must apply for it. 

It is important for you to consider how each potential settlement affects your current and post-divorce situation. You may want to speak to an attorney for guidance so you can avoid making mistakes that could put you at a severe financial disadvantage.

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Johnson & Montas P.A.
1290 Federal Hwy
Rockledge, FL 32955

Phone: 321-307-2048
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