Dr. Judith Gerhart, CFP
Certified Divorce Financial Analyst 
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Divorce and Finance
August 19, 2009
There are many financial considerations to make in divorce settlements. Consider children’s tax exemptions, child tax credits, education tax credits, future retirement pensions, and life insurance benefits. Also, always remember to factor in the impact of future taxes on all assets.
Many parents negotiate the allocation and use of the personal exemptions for the children on the tax returns. Usually, the parent in the higher tax bracket should claim the children to get a bigger benefit for the exemption (unless it gets phased out).
But keep in mind the ramifications of using the personal exemption: under the rules for education tax credits, only the parent who claims the child as an exemption AND pays the tuition can claim the credit. Also, a child tax credit can be lost if the child is claimed as a dependent by a parent who makes too much money (credit is phased out at $75,000).
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Posted by Judith Gerhart on August 19, 2009 | Permalink | Post a comment
Topics: Divorce, Post Divorce |
