Domestic Financial Consulting
Working through the financial aspects of a marital separation can be tedious and difficult. Identifying assets and debts, quantifying income and expenses, and understanding ownership, equitable division, and tax implications can be overwhelming.
Building an accurate list of the marital assets and debts is one of the two most important steps in working through the financial separation process. Clarity can identify and value the assets and debts held by the marriage at the date of separation, providing a basis for dividing the assets in an equitable manner. Clarity can also analyze the origination of assets and their history to assist legal counsel in appropriately classifying property as marital or separate. We guide our clients through the financial and tax implications of various asset distribution options, propose alternative equitable distribution scenarios, and explain the short and long term financial impact of proposed distributions.
Having a clear understanding of income and expenses is the second important financial step. Clarity can identify the available sources of income, analyze the historical standard of living, and identify unique or essential expenses which are critical in the fair determination of alimony and child support. Clarity works beyond the quick and easy technology afforded by debit and credit card usage to accurately track true spending. Clarity provides detailed standard of living analysis which is invaluable in completing the Financial Affidavit and working through post separation budgeting and financial planning.
The professionals at Clarity have served as financial neutrals for collaborative divorce proceedings. Financial neutrals provide unbiased expert financial services to both parties.
The professionals at Clarity are trained and experienced in the valuation of Defined Benefit Plans for marital dissolution purposes.
Clarity works closely with legal counsel to perform the necessary tracing to quantify the portion of assets that are legally classified as marital and separate property.
Having assisted clients in putting together their marital estate and establishing their standard of living and financial needs, Clarity can work with legal counsel through the preparation of the financial aspects of the Equitable Distribution and Financial Affidavits.
With significant tax experience, Clarity can assist clients and legal counsel in calculating the gross amount of alimony required to yield an amount of after-tax cash flow necessary to meet the client’s financial needs. In addition, Clarity can calculate the after-tax cash flow to the spouse paying alimony, taking into account the tax deduction for alimony. Clarity can also consult on the tax implications of various settlement alternatives.
Clarity works with clients to review financial records, in conjunction with independent research, to provide forensic accounting services. These services are often used in situations where a spouse is hiding or underreporting income. In addition, forensic accounting can assist legal counsel in identifying and valuing hidden assets.
Standard of Living Analysis & Budget Preparation
Clarity reviews the bank accounts, credit cards, investment accounts, and other asset sources for a period (typically six or twelve months) to quantify the standard of living prior to separation. By understanding the standard of living and necessary expenses, Clarity can work with the client to tailor a feasible budget for financial success post separation.