Retirement assets are one of the most difficult assets to divide for divorces in Florida. The complexity of the rules that govern these retirement assets makes them hotly contested and difficult to unwind, but there are ways to protect retirement assets.
Retirement and divorce
One of the trickiest aspects of managing retirement assets is that there are many different kinds of retirement accounts, like IRAs, 401ks, 403bs, pensions, and more. All of these have their own rules that affect what happens to them in divorce, which usually interacts in complex ways with tax law. For example, selling off the assets inside the account and splitting the proceeds can trigger a massive tax hit, and sharing the assets directly can also involve a tax hit as well as potentially violating plan rules. What makes things more complex is that any asset division must take into account not just the current value of the assets, but the value of their future growth.
There are different ways to safeguard retirement assets in a divorce, but it all starts with understanding the details of the retirement plan. The type of plan, the company where you worked, and the bank that operates the plan all affect plan rules about withdrawals, divisions, and other critical actions. Moreover, the division itself may make it hard to put the assets back into a tax-advantaged account afterward. Pay attention to all the paperwork so you don’t miss any opportunities.
Retirement assets are hard to divide without losing a lot of their value, so invest a lot of time and effort into maximizing their value.