When people in Texas get a divorce, taxes may be one consideration when it comes to property division. However, because of the Tax Cuts and Jobs Act, there are some additional changes ahead that people should be aware of.
People in Texas who decide to divorce may realize that the financial effects of the end of a marriage can be far more long-lasting than the emotional and practical aspects of the split. Indeed, many people planning for divorce feel intense stress about how their finances will change. However, by reviewing their assets, liabilities, income and expenses, people can make a plan for their post-divorce financial future that can help to improve their peace of mind moving forward.
Dividing marital estates is often a challenging and contentious process in Texas and around the country, and reaching an amicable settlement can be especially difficult when one of the most valuable assets involved is a family-owned business. Determining the value of a private business is rarely a straightforward process, and people who are not involved in day-to-day operations may believe that the companies run by their spouses are worth far more or far less than they actually are.
Due to the oil industry, Texas has a reputation for having lots of wealthy residents. However, that wealth can mean a downturn in couples' financial positions should they decide to divorce.
Some Texas women may want to consider keeping the home in a divorce even though this is not the advice usually given by financial professionals. The reason they advise against it is that it may be financially impossible to afford the home. A woman may be able to pay the mortgage but might struggle with the additional costs of maintaining the home including upkeep, insurance, taxes and utilities.
It's common for Texas residents to get married believing that they are entering a relationship that will last the rest of their lives. Unfortunately, divorce rates show that this is not always the case. Divorce takes on an extra level of complication for children of wealth. In many cases, it is beneficial for these individuals to create a prenuptial agreement prior to making their wedding vows.
People over 50 are twice as likely to get divorced than they were in the 1990s, and this could lead to financial problems for people in Texas who have not been active participants in the household finances. According to a report published by UBS Global Wealth Management, 56 percent of married women allow their spouses to make major financial and investment decisions.
When Texas residents are considering a divorce, there are steps they can take even before the process begins to protect themselves financially, particularly if they anticipate an acrimonious split. One of those steps is getting copies of all important financial documents and keeping them in a safe place such as with a friend or relative or in a safe deposit box.
Those who are contemplating a divorce will need to protect their financial interests as the marriage ends. Texas residents can do this by learning as much as possible about their household finances. This will make it easier to negotiate a fair settlement with a spouse. If necessary, be prepared to take possession of any valuables that may be broken or otherwise damaged by a vindictive spouse. However, it is important to note that the other spouse could still be entitled to half of an item's appraised value.
For people in Texas considering a divorce, the financial aspects of the end of a marriage can be complex and challenging. Retirement funds are often some of the largest and most important assets of a couple divided in a divorce settlement, and given the importance of these funds to the financial future of the spouses, they require additional attention. Different types of accounts can be governed by varying rules for division in divorce.