There are countless sources of advice and information for couples going through a divorce.. However, it seems that one particular group in New York and around the nation tends to be left out of the conversation. Older couples have seen an uptick in divorce over the past few years. Although the process is similar, there are different things to worry about that a younger couple may not.
Perhaps the term you’re likely to hear right after you or your spouse has filed for divorce is marital property. The process of property division is one that sees each person’s property is divided fairly and equitably. For older couples, this is a concern as their retirement accounts may be in jeopardy of being split. Some of those retirement accounts at risk include:
- 401(k) accounts
- Individual retirement accounts
Avoid this tax mistake
In many cases, you will have to divide your retirement accounts. One costly mistake that you should avoid is simply cashing these accounts out and giving half to your spouse. This will no doubt lead to a heavy tax being placed on yourself and potentially your former spouse. The best way to accomplish a transfer of funds is through a QDRO or qualified domestic relations order. A QDRO gives recognition to the transfer of part of all of the funds within one of the spouses’ retirement accounts.
Divorce, no matter your age, can be a complicated matter. It is recommended that people who are going through one do so with the guidance and assistance of experienced legal counsel.