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Common Mistakes When Dividing a Marital Estate

Common Mistakes When Dividing a Marital Estate

When your marriage ends, one of the most challenging jobs can be the division of the debts and assets of the marriage. In your rush to be over with the divorce, don’t make these common mistakes when dividing a marital estate. Contact a Baytown divorce lawyer for assistance.

Make Sure You Account for All Assets and Income

According to a recent study, nearly 20% of all divorces proceedings involve assets hidden by one of the parties. Take the time to make certain you know what’s out there.

Don’t Forget to Change Information on All Financial Accounts

There’s no benefit to keeping any joint accounts with your ex. In addition to bank accounts, you need to change credit cards, investment accounts and any debts/loans, including your mortgage. It’s also critical to change the beneficiary on life insurance policies, annuities, retirement accounts and investment portfolios.

Dividing a Marital Estate

Don’t Ignore the Tax Implications

One of the ways in which people commonly don’t end up getting a fair deal has to do with the potential tax consequences of owning certain property. Experts say it’s important to determine whether the dollars you are receiving are pre-tax or post-tax dollars. For example, if you take assets in an IRA in exchange for allowing your ex to keep the house, you will incur a tax obligation when you take distributions. However, your ex may incur no tax consequence upon the sale of the house, provided the net gain on the sale is below that allowed under the Internal Revenue Code.

Don’t Let Your Decisions Be Affected by Your Emotions

When you let your emotions take over, it’s hard to make rational decisions. It can be hard, but you have to view the financial aspects like a business transaction. In addition, don’t try to establish your own value for a house, or for personal property. Always get a professional to appraise marital assets at fair market value.

Contact Us

At the office of Linda Stewart Law, PLLC, in Baytown, our family law attorney brings more than 8 years of experience to clients in south Texas. To learn how we can help, call our office at 281-761-6042 or contact us online. We offer an initial consultation at a reduced fee of $50. We accept credit cards and will set up a payment plan, if appropriate. Our offices are open Monday through Thursday, from 9 a.m. until 5 p.m., and until noon on Fridays. Evening and weekend appointments can be arranged upon request.

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