There has been some very noteworthly posts lately in the world of family law. Here are a few I would like to note:
Taking the Plunge Has Major Tax and Financial Implications for Newlyweds posted by the Georgia Family Law Blog
The ceremony was a success, the rings fit, and the vows were a hit: When it
comes to planning their weddings, couples let no detail go unnoticed. If only
they were as astute at preparing for a joint financial future, starting a life
together might be a piece of cake.
With wedding season in full swing,
H&R Block (NYSE: HRB) reminds newlyweds that tying the knot means new tax
issues that tax professionals can help couples manage:
Marriage means
choices. The IRS allows married couples to file using the “married filing
jointly” or “married filing separately” status. Each has advantages that can be
difficult to understand. For example, if a taxpayer claims medical expenses or
other itemized deductions that are limited by their adjusted gross income,
filing separately may be the way to go. But if the person wants to claim most
tax credits or deduct their IRA contribution, they’ll probably need to file
jointly. Consulting a tax professional helps in determining the right choice for
couples filing for the first time.
Social Security numbers don’t change, but anyone who has changed their
last name will need to apply for a new Social Security card. If the name and
number don’t match, the IRS might delay processing of the return, which means a
refund could take longer than usual to arrive.
Marriage also means adjusting
retirement savings. Besides changing filing status on an employer’s 401(k)
account, newly married taxpayers also should consider increased limits for
tax-deductible IRA contributions. If the couple’s income meets certain limits,
they could qualify for more of a deduction. In some scenarios, one spouse also
may “borrow” from the other’s earnings to meet the limits.
Mark Jakubik of the Pennsylvania Family Law Blog has written a nice article on how to plan ahead to avoid potential divorce complications. Here is an excerpt of the article:
"In my experience, the typical small business owner who is divorcing wants his or her spouse to be awarded something other than an ownership interest, making non-transferability of stock or options crucial. However, even if the company does not have agreements preventing transferability, of course a shareholder or partner of a small business can also protect that interest through a prenuptial or post-nuptial agreement.
The spouse cannot be divested of rights to marital assets unilaterally or without a fair deal being struck, but such an agreement can be structured to protect the business interest while being fair to the spouse."
