Items Often Overlooked in Divorce

 When it comes to a divorce, it is not solely up to a judge to make all the decisions. A crucial part of any divorce is working with an attorney to help develop an agreement between you and your spouse. This helps you keep some amount of control of the result.

Even still, you should remain vigilant about some critical issues that are commonly overlooked when couples are in the negotiating phase of an agreement. Avoiding these mistakes can save you money and prevent unnecessary stress. A skilled divorce lawyer will know to address these issues, but the better prepared you are before beginning any legal process will only serve your emotional and financial interests in the future.

Overlooked Assets

Sometimes, one spouse may legitimately forget about assets that are not immediately obvious to them and fail to disclose these assets in the divorce process. Old retirement accounts, frequent flyer miles, experimental investments such as purchases of cryptocurrency, as well as intellectual property can easily be overlooked and left out of the final agreement dividing these potentially valuable assets. But it may be that a party-spouse takes deliberate steps to hide, omit or divert attention and access to such assets. Discovery – the formal legal exercise of obtaining records about assets and liabilities, among other things, from the other party – is often necessary so that a thorough investigation of your property can be conducted. Remember to provide your attorney with any information relating to safety deposit boxes, vacation properties/timeshares, credit card rewards points, and any intellectual or creative property you may have.

Debts

Assets (“positives”) are not the only thing being divided in a divorce. Debts (“negatives”) must be accounted for as well. People commonly overlook assets, but it is even easier to overlook outstanding debts because people do not enjoy thinking about them or even admitting they have debt. If you are contemplating a divorce, you should pull a current copy of your credit report as well as any statements reflecting debts to which you have access so that your attorney has a clear picture of the debts associated with your name and strategize a plan on how to allocate these debts before the divorce is finalized.  

Taxes

No one is a fan of the I.R.S. and they are a common enemy for both spouses during a divorce. The parties should each get ahead of this issue by consulting with an accountant or financial planner (or both) of that party’s individual choice to determine the best way to minimize their tax liability, both pre- and post-divorce. It is also important to consider the after-tax value of investments when dividing them. Finally, don’t forget to address the allocation of tax refunds (or liabilities), child tax credits/dependency exemptions, as well as carry-forward losses if such tax assets are applicable to your marital estate and case.

Inflation

Inflation can also play a factor in the division of assets in divorce. The value of certain financial assets, offset by certain expenses, should take inflation into account, to the extent this element is quantifiable. For example, one spouse agreeing to cover the cost of college for a child should be aware that said costs are capable of doubling in less than 15 years due to inflation.

There are many considerations and pitfalls you will want to avoid during and after a divorce. Working with an experienced attorney will ensure that commonly overlooked items are addressed so that you may begin your post-divorce life in the best position possible.

Rob McAngus, Partner with Verner Brumley Parker, P.C., is Board Certified in family Law and his practice is devoted primarily to family law, including high conflict divorce, custody cases, and complex property issues. In addition to being selected on the Board of Directors for the Family Law Section of the Dallas Bar Association; he values your priorities as a parent and works with you to achieve the goals that will help transition your family to a new normal.  As both an adopted child and a member of a blended family, Rob can provide a unique perspective in the practice of family law.

Rob has been recognized in Super Lawyers as a Rising Star in 2016 through 2021, and recently The National Advocates recognized Rob as one of the Top 40 Under 40.  He can be reached by calling 214.526.5234 or email at rmcangus@vernerbrumley.com.  Mr. McAngus received his bachelor’s degree cum laude and master’s degree from Baylor University and graduated cum laude from the Dedman School of Law at Southern Methodist University.