In a divorce, the court may order one spouse to pay temporary child support and spousal maintenance while the divorce proceeds, typically calculated as income before deductions, including deductions to a company sponsored 401(k).
When an employee spouse is ordered to pay temporary support while contributing the maximum to a 401(k), they may run into a cash flow problem during the divorce without the ability to reduce their retirement contributions once the divorce case commences – a preliminary injunction often bars the payor from making any adjustments to contributions until the divorce is finalized. Any changes made in anticipation of divorce may result in a finding of financial misconduct.
If you are ordered to pay temporary child support and/or spousal maintenance on top of affording a separate residence, handling legal fees, while contributing to a 401(k) while the divorce proceeds, an experienced attorney may be able to convince the court to adjust support based upon contributions being made to the retirement account or to permit the payor spouse to adjust their withholdings.
Financial planning goes hand in hand with a divorce. It is important to consider potential expenses such as temporary support, maintaining separate residences, and tax consequences of any decisions made as the divorce proceeds while working toward a favorable divorce settlement regarding marital property division and ongoing support. It is very helpful to work with an experienced attorney to understand the divorce process and identifying potential financial issues unique to your case. Contact Libertyville divorce lawyer Ronald L Bell & Associates for assistance today at 847-495-6000.