USA Balance sheet dividing divorce assets


2MD

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Hi All,

My wife and I have finally reached an agreement as far as how can fairly divide our assets - without getting lawyers involved. We are ok with a 50/50 division. I was hoping someone here can look over this hypothetical scenario (I am not able to post pics here, but link to image of the balance sheet we have created) and tell me if it looks ok, fair, and answer some question (before we take it to an accountant I guess?!). I tried to look for an online calculators to do this, I wasn't able to find any. Anyway, In this is scenario:

* We have a paid off house which the husband is keeping - $200K
* Cash Saving that the wife keeps - $80K
* A vehicle that is worth $25k
* A debt on the car that is $-25K (the wife will keep).

* Also, as part of settlement, some cash ($30k) is taken out of the retirement account and handed over to wife (row 4) and in row 5 we are assuming some taxes and penalties (-10k) on the money taken out of the retirement account which is shared.

* Finally, In row 8, the wife has agreed to get part of her total money over the next 5 years (let's say monthly ).

My questions are:

1- I am very confused about row 6 and 7 where the cost and debt of the car is the same, so they cancel each other out but the wife gets to keep it and will pay the monthly payments going forward. It seems to me that my wife's is basically ending up $25 less than me .. am I thinking correctly?

2- Row 8, even though I am paying $38K over 5 years and that money does not exist right now, should the chart include that money as part of total current assets and have it listed there as current asset?

3- Let's say the house is worth $200 today. But the reality is that there is always a cost involved is selling the house (taxes, fees, commission). Is that something that a lawyer/accountant would take into consideration and automatically list the house for less than actual value (let's say $180K, not $200K)?

4- In the case of the house, I am not buying out the wife, she will just sign the house over to me while I give her cash and a bigger chunk of out of my retirement money. Are there any tax scenarios that either one of us have to worry about?


Overall, what do you think? Regardless of it being fair or not, does it look correct? I am not sure if I have listed the debt correctly as it is shown as a negative under the wife. But I am guessing since she will be driving it, that's correct?

TIA.
 

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I'm not a lawyer.

First let me say I'm sorry you are going through this hard time. I'll do my best to give unbiased answers to your questions. So the goal is to make a 50/50 split on assets and liabilities. When you sit down with your wife and write out the split, "fair" is whatever you say it is. There are no firm rules you have to follow. You are basically making it up as you go and it is correct if you both say it is.

1. Since she will continue to make payments and the value of the asset is equal to the debt, she is not getting less than you.

2. IMO you have this listed correct. Where is your car in this equation?

3. Lets say the car needs major repairs in the month after your divorce is finalized. Will you comp her for that? The cost of ownership which is what you describe in number 3, should not be considered in this. You might never sell the house, you might sell tomorrow. After the divorce, what does your wife have to do with that?

4. I have no idea. Consult a local CPA

I'm not a lawyer.
 

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