Getting divorced essentially involves dissolving a marriage. However, the divorce process can easily become a war over a couple’s valuable assets. This is particularly true for individuals with high-net-worth assets. Here are some important considerations for those who are embarking on the asset division process during a divorce proceeding in California.
For starters, it is imperative that people who are getting divorced realize that different financial account types and assets come with varying tax obligations. As an example, unlike some accounts, an IRA account and a 401(k) plan will end up being taxed at the ordinary tax rates for income when distributions take place during retirement. It is essential to take into consideration the tax obligations associated with various assets when determining how to divide them.
In addition, it is wise to consider how inflation may impact one’s finances in the future. For instance, inflation may start to reduce a monthly alimony payment’s value in the future. In this situation, the recipient of the alimony might want to be prepared to request an alimony amount modification in the years ahead.
Although asset division can be confusing, an attorney in California can help a divorcing individual make sense out of it in his or her unique situation. The attorney can then help the individual to pursue a fair and comprehensive settlement with the other party through informal negotiations, for example. If the two parties cannot find common ground in this area, the attorney will be prepared to litigate this matter at divorce trial. Either way, the attorney will keep the client’s best interests at the forefront of the divorce proceeding.