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| Practice | | House | | Total Assets for Marty and Sue | | Value | $350,000 | Value | | | | Less taxes: | -100,000 | Less mortgage: | | | | | Less taxes: | | | | Net | $250,000 | Net | | $360,000 | | Marty and Sue each get half of the total assets = $180,000 each | | Marty's net ($250,000) minus his half ($180,000) = Marty owes Sue $70,000. |
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With the help of a lawyer, the couple decided that Marty would pay Sue $70,000 over four years at 6 percent interest. |
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Sounds easy, right? It isn't always this simple. Maybe Marty never intends to sell the practice, so why subtract taxes he'll never have to pay? Or maybe Sue never intends to part with the house. As you go about crafting your own settlement, you will have to take your personal situation into account. |
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In some jurisdictions, unless taxes are immediate and specific and can be calculated with certainty, the Court will simply ignore the tax issues and divide according to present value. |
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Financial Fine Print: Make Sure You Read It |
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Make sure, when dividing the spoils of a life spent together, that you account for all the financial elements, including pension funds, taxes, and debt. |
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In some states, pensions can be divided between you and your spouse, even though only one of you earned it. (Remember, marriage is viewed as a partnership in most states.) |
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