Divorce can be difficult for anyone who is going through it. However, Missouri residents and others will need to be aware of key recent tax changes that may play a role in a divorce settlement. Perhaps the most well-known change is that alimony will no longer be a tax deduction for the payer. This could mean that those who are asked to make such payments will pay less than in previous years.
Those who are set to receive payments may try harder to get as much as possible since they no longer have to submit taxes on that money. There are a couple of other changes that are related to the new tax law, and they could impact those who have prenuptial agreements or try to modify their agreements in 2019 and beyond. Individuals who have a prenuptial or postnuptial agreement may benefit from reviewing and renegotiating their deals prior to 2019.
Despite these changes, it’s important that individuals don’t rush to create a bad deal. It’s still a good idea to work with a financial adviser to look at a divorce settlement as a whole. As financial and legal professionals become accustomed to the new rules, they will likely be able to create new strategies to help protect a person’s long-term financial security.
Working with an attorney during the divorce process is one way to make asset protection a top priority. A prepared individual may be able to negotiate lower alimony payments or obtain a larger share of a retirement account. Legal counsel could help the client review their financial situation and determine which assets are worth asking for and which ones may not be as important in a divorce.