Year-End Financial Decisions in Divorce: Dividing Assets and Preparing for Your Future

We are nearing the end of the year and many divorcing couples are going to be faced with very real decisions that will impact their financial circumstances far into the future. If you are currently navigating a divorce in California, or believe that divorce may be in your future, you owe it to yourself to gain a solid understanding of how the end of the year can impact you in your divorce financially.

What “Year-End” Means for Your Divorce Timeline

As the year comes to a close it can be important to understand how your divorce and the decisions you make might be impacted. This is particularly important when it comes to considering how different moves might impact you financially, since a divorce shakes up even the most financially-secure couples.

Things that can impact couples seeking a divorce toward the end of a year might include:

• Court Congestion: Couples are tied to the court’s availability and the court’s schedule. There are many individuals who make a push to attempt to finalize their lingering divorce before the start of the new year. This increase in demand can lead to a flooding of the court calendars, and delays in scheduling hearings and trials.
• Rushing: You really do need to prioritize completing a divorce correctly, over gaining a divorce decree quickly. There are many items the parties must agree on and mandatory financial disclosures that must be made before a divorce settlement can be reached. Attempting to rush these mandatory financial disclosures can lead to overlooking important items and incomplete information being given to the other party and the courts. Rushing can also lead to distracted, stressed couples overlooking important aspects of their life and agreeing too quickly to terms that do not actually work for their life. Inevitably, plans that are not well thought out will have to be revisited, leading to even greater headaches and legal expenses in the future.
• Taxes: There are going to be financial and tax implications with any divorce. What this means for you will vary on a case-by-case basis. It will also serve some individuals better to do what they can to file before the end of the year, where in other cases it might be neutral or even preferred to file in the new year instead. It is crucial to seek out expert tax advice that will be able to inform you in these matters.
• 6-Month Waiting Period: In California, there is a mandatory 6-month waiting period before a court can enter judgment of a divorce. This means that the court cannot finalize a divorce until six months have expired from the date of service of a copy of summons and petition for divorce or the date of appearance of the respondent, whichever occurs first. See Family Code section 2339. The purpose of this is to encourage reconciliation or ensure both parties have time to fully understand the legal and financial consequences of divorce. It provides a cooling-off period before legally ending the marriage. The court cannot shorten or waive this mandatory waiting period.

By looking ahead and preparing early, you can often avoid unnecessary pressure and better ensure that the choices you make are serving you and the long-term goals you have for yourself and your family as you move forward.

Contact Cardwell Steigerwald Young LLP

There are many nuanced items to consider in every divorce case. For expert legal advice on your own circumstances and potential case, contact the experienced San Francisco divorce attorneys at Cardwell Steigerwald Young LLP.