Children’s financial accounts during a divorce process..should you be concerned?
How Your Children’s Financial Accounts Might Be Impacted From Your Divorce
Navigating the divorce process can be particularly challenging for families. While dividing assets is rarely easy in any scenario, determining how to divide accounts you started for your children during your marriage can raise additional questions and concerns.
Types of children’s financial accounts
There are several types of accounts parents open for their children. Some of the most typical accounts are 529 plans for education-related savings, joint checking accounts, trust funds, interest-earning accounts, and custodial accounts.
Education savings accounts (529 plans)
These plans are named after Section 529 of the Internal Revenue Code, are not deductible, and offer other tax advantages. 529 plans help families pay for future qualifying education-related expenses like tuition or post-secondary training.
In most cases, the custodial parent in a divorce should be the 529 plan account owner. Because these plans are considered assets of the account owner, how the courts handle these accounts during the division of marital assets is sometimes difficult to predict. In some cases, a judge will exclude 529 plans from the division of assets, in other cases they may require … Read More... “How Divorce Can Impact Children’s Financial Accounts”
