Recent Tax Law Changes And Their Impact On Divorce

The dissolution of a marriage often has a profound impact on the finances of both parties. Divorce can impact your business, which assets you retain after the divorce is complete and your income if you request or are asked to pay spousal maintenance (alimony). The federal Tax Cuts and Jobs Act, passed in December 2017, has the potential to change the playing field when it comes to negotiations around spousal maintenance during collaborative divorce discussions or how your case is presented if your divorce must be litigated.

At the Law Firm of Debra J. Braselton, P.C., our founding attorney can advise you on the implications of the upcoming changes in tax law and how they may influence your finances in the future. Our firm is connected to a network of knowledgeable professionals, including experts in financial planning and forensic accounting, who can partner with you and Debra to strategize your best options.

How The New Tax Law Will Impact Divorce

The federal tax overhaul means that divorces that are initiated on or after Jan. 1, 2019, will no longer allow payers of alimony to deduct those payments on their taxes. The previous federal standard had been in place for many decades. Illinois recently passed a bill at the state level that standardized what judges could allocate for alimony, but those guidelines were based upon the assumption that payers could deduct their spousal maintenance payments. The new law also lets recipients of alimony stop listing their spousal maintenance as taxable income. As a result, it is expected that couples getting divorced in 2019 or later will struggle harder to reach agreement on spousal support terms.

Our lawyer, who was one of the first attorneys in the state to be trained in conducting collaborative divorce proceedings, can help you map out the best ways to navigate the maze created by tax laws and divorce. Negotiated settlements emphasize a "team" approach to finding solutions and are entered into with the idea that both parties can find a way to create a win-win agreement on most matters.

Contact Us For A Consultation On Tax Issues

Regardless of your income bracket, we can help you find a pathway to a successful post-divorce future. Call us in Oakbrook Terrace at 630-DIVORCE or 630-261-1222, or email us to set up an appointment.