Significant Tax Planning is Essential

Individuals willing to cooperate with each other usually have much more flexibility to develop a strong solution that is fair to both parties, while preserving the asset involved and the interests of both. By incorporating careful tax planning, such as consideration of the different tax effects of orders for child support as compared to spousal support, they can have a substantial impact on both short and long-term tax results. Better alternatives can often be incorporated into the separation agreement (dissolution) and are usually acceptable to the court. Careful consideration should also be given to issues such as whether to make provisions for children’s college expenses.