A divorce can mean that Florida estranged couples may have a number of complex investments to divide. Since this can incur penalties and taxes if not done correctly, people in this situation may want to work with legal and financial professionals throughout this process. People who have not been very involved in their marital finances need to make sure they know what assets they have and how to get to them.
Some people may be concerned about a spouse making withdrawals or investments they do not agree with. It might be necessary to freeze some accounts until a decision has been made about how to divide property. For 401(k)s and 403(b)s, people will need a document called a qualified domestic relations order. This prevents people from accruing penalties and taxes when dividing these accounts in a divorce. The rules are different with an IRA. While there is no need for a QDRO, it is usually necessary to roll the distribution into a new account. People should also be aware that some retirement accounts will be taxed on distribution during retirement and some will not.
After the divorce, people should also make sure to remove ex-spouses as beneficiaries from retirement and other investment accounts. Otherwise, those former spouses could still inherit those assets.
People may also need to work out an agreement on spousal and child support. The former may be paid by one spouse to the other if one spouse makes significantly more money than the other. It may be temporary and only last as long as it takes the person to go through schooling or training to get a higher-paying job. Child support is separate and is supposed to be used only to pay for children’s needs. These amounts may be modified if there is a change in circumstances.