I’ve covered this topic before when I shared the story about my client “Jane“, but recently a journalist asked for even more. Here are a few more tips that may help you out if you find yourself in this tough situation.
1) Do NOT comingle your inheritance. When married and receiving an inheritance always keep it as sole and separate property. You can always contribute to the community but if you comingle the whole with the community it becomes community property.
2) Do NOT insist on staying in the marital house with the ex-spouse unless you know exactly what a Watts payment is. It can be confusing so make sure to consult with an expert on this, and anything else that you don’t understand. Emotions are really raw and it’s not the best time to make decisions alone.
3) Do NOT assume that an amicable split means that you are on the same page. Be explicit about who claims the dependents. Despite everyone’s best intentions, this can become a terrible issue down the road when filing tax returns.
4) Do NOT complete your taxes using old information. Divorces completed after 12/31/18 will have another huge issue to contemplate – alimony payments (spousal support) is no longer deductible to the payor nor taxable to the payee, keep this in mind for timing sake.
Divorce is hard enough … don’t let muddy money agreements add to the stress. Work with a financial advisor to help you navigate that side of things and make sure to also practice lots of self-care.
Let’s chat soon!