Divorce always has a financial impact on both parties, and it is beneficial for each person about to move forward with this process to consider how to minimize the potentially negative effects it can have. Due to various factors, including changes to tax laws, it could be smart for a Pennsylvania couple to work to finalize their divorce before the end of the year. This effort could have certain financial benefits.
One of the main reasons why it is smart for couples to attempt to finalize their divorce by the end of 2018 is because of the implementation of various tax laws effective at the beginning of 2019. After the first of the year, the person paying alimony will no longer be able to deduct that expense from his or her taxes. This could lead to increasing complications for individuals attempting to negotiate financial settlements.
Changes in tax laws also reduce the amount of money a person can deduct for property taxes, which may complicate attempts in deciding who will keep the family home. Additionally, there will be significant changes to the deductions allowed for children. It is more important than ever for divorcing Pennsylvania couples to carefully consider the financial impact of the choices they make while working on a final divorce order.
Divorce is a complex process, and it is easy to make decisions based on temporary emotions instead of what is truly best. In light of the recent changes in tax laws, it is smart to be prudent and thoughtful regarding the terms of a final order. It may also be prudent to finalize orders before the end of the year and the implementation of new laws and regulations.