For Illinois couples who are getting divorced, dividing up a pension plan or 401(k) must be done carefully in order to avoid expensive mistakes. First, it's necessary to have a document called a qualified domestic relations order for each account that must be divided.
Epic divorce battles are fought over which spouse gets the Illinois family home, retirement account, favorite car, or any number of expensive or personally treasured objects of value. And although it is never a good idea and sometimes can be damaging, the kids all too often become the pawns in child custody and child support matters. However, how liabilities are apportioned between the divorcing couple is just as important as each begins their new life.
The holidays can be a tough time for parents and children in Illinois following a separation or divorce. Both may be feeling many different emotions, such as anger, loss, betrayal, sadness and fear. Parents must deal with these emotions in a way that does not impact on their children's holiday. The focus at this time needs to be on helping children adjust to the changes and still enjoy a happy holiday season.
People in Illinois who are getting a divorce should make sure they avoid common financial errors. For example, it is important to take taxes into account when dividing some assets. A document called a qualified domestic relations order is necessary when dividing a 401(k), and a distribution must then be rolled into an IRA. This prevents taxes and penalties. People should also be aware that if they sell some assets to pay bills, there could be taxes on the sale.
After being passed into law in December 2017, the Tax Cuts and Jobs Act eliminated a number of deductions and exemptions, raised the Alternative Minimum Tax limit and reduced federal rates of taxation. Furthermore, this tax reform will affect the way child support and alimony are treated for Illinois residents. The TCJA gets rid of both dependent and personal exemptions and raises the standard deductions.
Getting a divorce takes the number two spot on the Holmes-Rahe Stress Inventory. This tool measures how likely someone in Illinois or elsewhere will experience health problems related to stress within two years of an incident taking place. While divorce can be stressful for anyone, it may take an especially difficult toll on those who are 50 or older. Studying these issues can be important as the divorce rate for this age group has doubled since 1990.
In Illinois and across the country, a growing number of older Americans is choosing to divorce. These statistics are part of a social trend that has been increasing over the decades, and the growth in baby boomer divorces is now being referred to as a "gray divorce revolution." Since 1990, the divorce rate for Americans aged 50 and older has doubled. At the same time, the divorce rate for people aged 65 and older has tripled. Divorce is more socially acceptable and familiar to people, but there is a number of specific factors that may affect a particular couple's decision to separate.
When parents share legal and physical custody of their children after a divorce or separation, this is generally referred to as joint custody. As more Illinois families are composed of two working parents and their children, joint custody has become an increasingly popular solution. According to a joint custody plan, both parents should share the financial responsibility for raising their children as well as the physical effort of doing so. This may make parents wonder about the impact that joint custody could have on a child support order.
Ex-spouses in Illinois know firsthand the effect that divorce can have on one's finances. In many instances, ending a marriage means splitting financial assets in half, trying to support multiple households at the same time and covering attorney fees. Research shows that households that have never gone through a divorce have about 30 percent more wealth than those that have. It's important to note that many post-divorce challenges are unique to ex-wives.
Due to provisions of the tax law overhaul that was signed in December 2017, many Illinois couples in unhappy marriages might find a new reason to call it quits sooner rather than later. An attempt to avoid a provision in the new law that will soon make alimony payments more costly could produce additional filings. This part of the tax bill will be effective for divorces finalized in 2019 and thereafter.