Nashville Divorce Client Did Not Understand Federal Tax Consequences
A client in my Nashville, TN office told me that he wanted to keep the investments / stocks and his wife could keep an equal amount of cash. He was a very successful business owner and informed me that this is what he wanted to do and his divorce attorney agreed that it was a good idea. He told me that the investments had good growth potential and that was the basis for his decision and proposed property settlement. I reminded him that he would have to pay long-term capital gains taxes of 15% when he sold the investments / stocks. I asked him if he had he factored that expense into his calculations. He had a blank stare and responded, “No, I did not consider the capital gains taxes”.
This example shows that even the most intelligent and successful people do not think clearly during their divorce regardless if is in Nashville, Brentwood, another city in TN or beyond. If you are in the midst of a divorce, you should not rely on your attorney to understand all of the financial details of your proposed settlement. The divorce attorney is only responsible for the legal issues. You are responsible for the financial / money issues and consequences. Take the time to understand the financial issues to ensure you get a financially smart divorce.