Divorce can be an emotionally challenging event. Two individuals who have presumably loved each other suddenly determine that it is in their best interests to go their separate ways. Oftentimes, this comes after infidelity or emotional detachment, and other times money issues come into play. Yet, for all the emotional damage that can be caused by divorce, it can be equaled or even surpassed by the financial ramifications of divorce. Although many of the financial consequences can be negotiated or litigated, there may be change coming that is unavoidable.
News of the proposed Republican tax plan has circulated television, print and the web. This tax plan, if passed into law, could have a significant impact on divorced and divorcing couples. According to reports, the proposed plan would eliminate a deduction that allows those who pay spousal support to deduct the paid amount from their taxable income. This can be a significant amount, which means that, should the plan become law, these individuals would see their tax bill increase by a hefty sum.
Many in the field of family law are concerned that this change could make divorce negotiations even more difficult and effect families in a negative way. They claim that eliminating the deduction decreases the amount of resources available to each party in a divorce and can cause each of them to be more adamant about their position while they negotiate. If the matter cannot be settled through negotiation, then it must be litigated, which in turn increases the cost these individuals must shoulder.
As scary as this may sound, the truth is that it is not the law of the land as of now. Even if it is eventually passed, divorcing individuals just need to be smarter about how they approach resolution. By being fully informed, divorced parents can make the legal decisions that are right for them and leave them positioned for a solid start to their post-divorce life. To learn more about how to develop a divorce legal strategy that takes into account changes in the law, Illinois and Indiana residents should consider speaking with a skilled attorney.