Changes in the U.S. tax law, effective January 1, 2019, may have a significant effect on the financial aspects of your separation or divorce. After consulting your tax or financial advisor, you may want to consider them when deciding when to finalize  your separation or divorce.

The most widely known difference concerns the treatment of Spousal Support (also known as "Alimony" and "Maintenance"). If a Separation or Marital Settlement Agreement is signed by December 31, 2018, or a contested divorce is finalized by December 31, 2018, the person who pays Spousal Support will continue to be able to take a tax deduction for the payments, and the person who receives the Spousal Support will have to pay taxes on the payments received. However, if the Agreement is signed or the contested divorce is finalized on or after January 1, 2019, the payor has no tax deduction and the recipient pays no taxes on the payments.  This can be a game-changer for many families, as the "old" treatment often had the effect of shifting income from a higher marginal tax bracket to a lower marginal tax bracket, this lowering the total tax paid and making more money available to both parties.

Other tax law changes will affect the valuation of many businesses, often the largest asset to be divided between a couple;  the affordability of keeping the family home due to the limit on the deductablility of mortgage interest and real estate taxes; saving for and payment for children's educations; treatment of capital gains; and myriad smaller effects.  For a more thorough treatment of these issues, see the excellent article in the New York Times.

But don't take my word for it.  Consult your accountant or financial advisor for the details of the new tax law and how they will affect your particular situation.

While it may be too late to rush a contested case through the court system, there is still time to work out an equitable agreement through mediation before the end of the year.  With the help of your tax advisor, a mediator can work quickly, and confidentially, to help you and your soon-to-be ex settle these nettlesome issues in a way that protects your interests and yields the best possible outcome for both of you.