A divorce is an extremely emotional event for both partners as well as for family and friends. To follow are a few things you need to do to make sure your financial house is in order (note that the rules for same-sex couples may be different).
- If you are still in the negotiation process it may be helpful to sit down with a financial planner to draft a new budget so you have the numbers to back up your alimony or child support requests.
- If you were covered under your former spouse's health insurance plan, you probably assume your coverage ends on the day of the divorce. However, a COBRA provision allows you to carry the same healthcare coverage for up to 36 months.
- If you receive alimony, it is considered to be a taxable income for the receiving ex-partner and an above the line deduction for the one responsible for paying it. If the person receiving alimony does not have any earned income, he/she can use a portion of it to contribute to an IRA account. If you receive child support, the rules are the exact opposite.
- As with other life events, review your Will and other estate documents for appropriate beneficiary changes.
