Tax Considerations in Divorce

Dallas Divorce Attorney and Tax Lawyer

There can be tax implications to every divorce, whether there is a modest amount of community property or a complex, high net-worth estate. Even when both parties are concerned about the financial aspects of divorce, tax issues are often overlooked. In situations involving larger and more complex assets, the tax implications can become very complicated. If you are not careful in your approach to these issues, you may ultimately receive less money in your property settlement.

Attorney Bruce Turner has extensive experience in complex property division in Texas, and 35 years of experience as a tax lawyer. He and the lawyers at Bennett, Weston, LaJone & Turner, P.C., can provide advice which minimizes tax implications before the divorce and maximizes the available assets after the divorce. Our goal is for clients to come out of a divorce in good financial health.

Tax Issues to Consider

Generally, it is a good idea to give the spouse in the lower tax bracket more taxable assets from the marital property. We will advise you on the best way to handle the division of retirement plans, IRAs, pension plans, mortgages, businesses, stocks and other assets. We strive to:

• Structure cases with a view of taxes and complications
• Keep in mind the value of assets after tax considerations
• Structure transactions so that no tax is incurred after taxes
• Give clients all of their options and advice on protecting themselves financially

Alimony payments are tax deductible for the payer and taxable income for the payee. Because the party making the payments is often in a higher tax bracket than the party receiving the payments, this arrangement can be beneficial to both.

Retirement accounts may have a lower value than stocks or cash because of the tax implications. To avoid tax penalties for early disbursement of funds, you can request that the court issue a Qualified Domestic Relations Order (QDRO). We draft our own QDROs and can assist you with the valuation of your retirement and investment accounts.

As business attorneys, we use our knowledge of tax and business concerns to help clients get the best solutions possible. We provide advice on the tax consequences of splitting closely-held businesses, partnerships, professional practices and stock options.

Careful tax planning can result in a better divorce settlement for both parties. To make an appointment, please call 972-862-2332 or contact us online.