Divorce and separation are realities many people of all income and age face. Once the decision is made, many want the process over and done with as soon as possible. However, careful consideration has to be taken when it comes to finances.
Including a firm like Liu & Associates in your divorce and separation proceedings will ensure that all division of assets will be completed fairly with no surprises when taxes are due.
Separation of Assets
Beginning with a fair and total valuation of you and your spouse’s assets, our experienced forensic accountants can guide you through this process.
When it comes to separation and divorce, assets are divided into two categories: family property and excluded property.
Family property includes everything that you and your spouse owned on the date of your separation. Even if the family property is one spouse’s name, it is still considered dividable.
Family property includes assets such as the family home, investments, bank accounts, insurance policies, pensions, and businesses.
Excluded property entails property that was owned before you and your spouse began living together. However, any increase in the property while the two of you were together is considered family property and must be split during the separation.
Taxes after divorce
Your marital status at the end of the calendar year determines how to file your taxes.
Navigating your tax return after a separation can be challenging. You must take into consideration child support, alimony and who is to claim any children as dependents.
If your separation is amicable, there may be a conflict involving who claims the children on their tax return. The best way to circumvent this is to file your taxes before your spouse does.
There are also opportunities to write off legal fees involved in the separation.
Let our expert accountants sort out your taxes for you following a divorce. We can ensure everything is filed properly with the CRA (Canada Revenue Agency) and take advantage of any tax deductions you are eligible for.
Income Arrangements
Depending on your situation, paying spousal support may be a requirement of your separation agreement. Also known as alimony, this monthly payment is court-ordered when one spouse has to pay the other spouse for their financial support following a separation.
There are many questions surrounding spousal support:
- When is it required?
- Who is eligible to receive it?
- Is it necessary when child support is being paid?
These are all questions we at Liu & Associates can answer for you!
Coming to An Appropriate Settlement
Whether you are looking to maximize the value of your asset division or are making plans to retain specific assets, Liu & Associates will help you understand any possible financial and tax consequences so that you can come to an appropriate settlement.
Ultimately, our forensic accounting and tax professionals can help you and your newly separated spouse gain a clear picture of your finances. Contact us today for more information!