When a Florida couple sits down to start negotiating the terms of their divorce, things can really start to seem overwhelming. The emotional upheaval of the moment can cloud their judgement and ability to pragmatically assess the financial big picture.
Marriage is an emotional commitment, but it also is a legal contract with financial implications for both sides. Outside of child custody issues, property division is the largest part of the terms of the settlement, so it is important to make sure that all assets are on the table. Residents of Southwest Florida may want to find out more about all that goes into property division as they plan for the future.
Keeping track of all assets during inventory
As Florida is an equitable division state, the judge will make a ruling based on a fair but not necessarily equal division of property. The spouses must provide an inventory of all marital property. These are all assets that either or both acquired during the marriage, including income, real estate, the family home, cars, retirement accounts, or purchased property, as well as debts such as a mortgage or car loan.
When preparing the inventory, the spouses must be careful to not overlook present or future investments. If the couple has children, they probably have a college fund such as a 529 college savings plan. It is important to remember that the parent who opened the account becomes the account holder and may legally withdrawal funds at any time, even if the child is the beneficiary. Once the child turns 18, they most likely will not be eligible for child support, so it is crucial to your child’s future to include this asset during negotiations.
Finding out if your spouse has stock options through their company is important, as these assets may increase in value dramatically in the future. If the spouse will not disclose all their employee benefits, a request for discovery can divulge this information. The company may be able to hold the non-employee spouse’s share of options.
Tax burdens and club memberships
Couples who previously filed jointly may experience an unequal tax burden for capital loss carryovers once they file separately. If both spouses had incurred losses on joint returns, capital losses should carry forward until fully deducted, and the spouses should divide this carryover equally during property division.
And finally, not having to pay the annual fees on that country club membership may seem a relief, and it may make more sense to let the other spouse keep it. The courts view this asset as a divisible investment, however, so it should also appear on the inventory list.