When individuals are going through divorce with complex finances, it is important to have a thorough analysis conduct to ensure that any settlement in divorce is fair and just.
Many individuals want to settle their divorce matter. The reality, however, is that it can be critical to have proper valuations of various assets. From the house, to the cars, to the investments and retirement accounts, it is simply to vital to know what these assets are worth.
As it relates to taxes, there can also be significant considerations for parties going through a divorce. Typically, transfers incident to divorce are not taxable. However, certain assets may carry tax ramifications with them that the parties may want to consider.
Take a Roth IRA versus a Traditional IRA. With a Roth IRA, the taxes have already been paid. But if a party is taking a Traditional IRA, those parties generally will have to pay taxes after they make withdraws even at age 59 1/2.
A financial neutral in the collaborative process can be critical toward helping parties work through these issues. A financial neutral can help coordinate the valuation of assets, in addition to explaining the tax ramifications.
A financial neutral might also be able to help trace pre-marital assets for parties as well. Tracing pre-marital assets can be important for many parties.
In the end, many parties may want to settle their divorce outside of court. However, the financial details can hang up settlement.
This is where the collaborative process can be helpful for parties going through a collaborative divorce.