For New Jersey seniors who are considering divorce, understanding the financial issues involved in the process is important. Dividing marital wealth is complicated, and when both spouses are at or beyond retirement age, those calculations become even more pressing. Alimony is one thing to consider, but there are many other issues that deserve attention in the early stages of a late-life divorce.
New Jersey spouses who are considering divorce may want to think carefully about the role that spousal support will play in their future budgets. That's especially true now that the tax deduction for alimony will no longer be in effect after the end of 2018. Making wise choices that are in line with one's long-term planning is an important part of moving forward.
Most New Jersey residents are aware that 2019 will bring new changes in the way that spousal support is handled during a divorce. Once this year comes to a close, the party tasked with making alimony payments will no longer be able to claim those expenses as deductions on his or her tax return. The party receiving those payments will no longer have to claim them as income. However, these changes are prospective only and do not affect divorces that have already be finalized.
Charting out one's anticipated income and expenses is a critical part of a New Jersey divorce. For spouses who expect to receive alimony or child support, it's critical to understand that those payments might not begin coming in as quickly as anticipated. In fact, it's not uncommon for the paying spouse to balk at making those payments, especially in the weeks and months after a filing. Having a plan in place can make it easier to cover living expenses during this period of time.
As they near the end of a lengthy marriage, many New Jersey residents focus on negotiating spousal support. While alimony may be an important part of addressing financial needs after a divorce, older spouses may want to think about other options when it comes to working out the financial details. That's because alimony is only a viable option while the paying spouse is still alive, while certain other assets could continue to bring in income regardless of the lifespan of one's soon-to-be ex.
Negotiating spousal support is never a simple or easy process, but many breadwinners make very common mistakes that can harm their interests in the long run. Knowing what those mistakes are can help men and women avoid choosing the same path and experiencing the same outcome. New Jersey spouses should take the time to think about the long-term ramifications of making hasty or ill-advised alimony decisions.
It's never easy for New Jersey spouses to make the decision to end a marriage, but in some cases timing is an important consideration. For example, spouses who expect to pay alimony should think carefully about how a big change in tax laws could alter their tax bills in the years to come. The Tax Cuts and Jobs Act has eliminated the alimony tax deduction, which will affect the bottom line for many New Jersey spouses.
According to researchers, one of the biggest risks to a marriage is a shift in traditional gender roles. Very often, those changes take place when the New Jersey spouse who was once financially dependent on his or her partner begins earning more. If one spouse starts to outearn the other, the change in marital dynamic can cause serious harm. If divorce is the eventual outcome, alimony may not be a cut-and-dried issue.
When it comes to matters of spousal support, New Jersey spouses should know that there is very little that is set in stone. Family law courts have the ability to create an alimony structure that serves the ends of each couple, as the court sees fit. That means that spouses should pay close attention to their actions as they near a divorce, including their online activities. Family law attorneys are now turning to Facebook and other social media sites for information and evidence that can be used in negotiating for property division, child custody and alimony.
As lawmakers continue working on a large-scale tax plan, a great deal of focus has been placed on improving the financial landscape for working-class Americans, including those in New Jersey. However, certain provisions within the proposed tax bill could have drastic negative consequences on working families. An example lies in the alimony tax deduction, which is currently slated to end should the bill be signed into law in its current form and has sparked debate across the nation.