Monday, October 13, 2008

Time for Tax Planning

A Gentle Reminder: As of today, there is barely enough time to finish a divorce here in Texas before the end of the year. Because of the 60-day waiting period required by Texas law, a divorce filed after October 31 cannot be finished by the end of the year. If you are in a divorce that is already pending, you can determine whether the 60-day waiting period will be a problem.

Some people want to wrap up their divorces at the end of the year, or just after the first of the new year. If there may be tax considerations in your case, you should talk with your CPA or a tax attorney to advise you about your best course of action.

Naturally, given that it takes two to tango (and file tax returns), this is not necessarily a decision that just one party to a divorce gets to make. Timing for tax purposes affects both parties, so there must be a meeting of the minds or a court ruling. Taxes sometimes can be a major issue in a divorce, so be prepared to address the issue. You need to think about your situation and, with professional help, decide how you want to proceed. If you are going to mediation, be prepared to discuss the tax aspects of any settlement.

This may seem like just one more thing to deal with, but it can really affect the bottom line of any settlement, so plan ahead!

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