If you are contemplating divorce in Rhode Island, then you may be wondering how to divide retirement accounts and property fairly. Both spouses own all assets acquired during a marriage in Rhode Island, so they must be divided equitably. There are four choices available to couples.
Divide assets separately
The most straightforward answer is to divide assets until they balance out. While this is the best answer for most couples, some spouses are unwilling to negotiate, making this a problematic solution. Before entering the negotiations, think about what has the most value to both of you and see if you can each keep the things that matter most to you.
Divide the asset
Another solution is to divide the asset. This solution works well for couples who own multiple homes as they may each be able to keep one. You can also divide 401(k)s using this method, and retirement funds can send the soon-to-be-ex regular payments once the spouse earning the money reaches payout.
You and your spouse can decide to liquidate retirement accounts and property. Consider this move carefully because it can have substantial tax consequences. A CPA or a divorce attorney may explain the implications to you. Depending on the type of retirement account, this might also require special court approval.
Roll into a different asset
If the person earning the 401(k) is 59.5 years old or older, you can roll the retirement asset into two individual retirement accounts. This solution gives each person the option of managing the fund as they desire.
You mustn’t let your emotions get in the way when you and your spouse are dividing up assets. Often, everyone comes out a loser when that happens, so seek an experienced legal professional to help you.