Taxes and Divorce Settlements in Arizona
In a divorce in Arizona, you need to consider the tax implications of certain assets when entering into a divorce settlement. Failure to consider tax consequences when dividing community property in Arizona can result in an unfair and inequitable divorce settlement. Arizona Revised Statute Section 25-318(B) allows a judge to consider the taxes that will become due upon the sale of an asset, such as capital gains taxes on a home. There are also income tax issues related to monies held in some retirement accounts. This means you should not treat $10,000.00 in a bank account the same of $10,000.00 in a retirement account.
The Montana Supreme Court ruled on the issues of taking taxes into consideration during a divorce in the case of In re Marriage of Broesder. Although the case cannot be cited as precedent in Arizona, it provides an overview of the subject. The American Bar Association had the following to say about the Montana Supreme Court’s ruling in that matter as follows:
The standing master was required to consider the tax consequences of the division of marital estate, which would likely require the sale of ranch, when dividing marital property in dissolution proceeding; the sale of ranch would trigger tax consequences, and the sale of ranch was likely as the record failed to establish there were available assets in the marital estate for husband to pay wife for her share of the marital estate.
Our attorneys have over 100 years combined experience representing people going through a divorce. We are well aware of the income tax issues to watch out for and can help you divide property given whatever tax situation exists. Call us at (480)305-8300 to speak to one of our experienced and qualified Arizona divorce attorneys.
If you have a question about divorce in Arizona, please call to speak to one of our experienced Scottsdale divorce and Phoenix Arizona attorneys at (480)305-8300.
Hildebrand Law, PC