Pride Law family law, mediation & collaborative divorce
Call for an Initial Consultation

Email Us

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Collaborate. Mediate. Separate. Divorce Doesn’t Have to Mean War.

Consider retirement account divisions

In Pennsylvania, courts use an equitable distribution model to determine how to divide a couple's assets during divorce. This model helps determine how to split a couple's assets, including retirement accounts.

When negotiating a divorce settlement, the parties may consider how taxes can impact the value of the assets. For example, some retirement accounts are taxed at the time that a contribution is made while others are taxed at the time a withdrawal is made. Generally, the only time that a withdrawal that is not taxed can be taken out is when the person has retired and meets specific requirements. By equalizing the accounts and splitting them based on after-tax value, the spouses can split assets in a more equal manner.

Another consideration regarding retirement accounts during the divorce negotiations is the spouses' respective tax brackets. When they are filing single, one of the spouses may be in a higher tax bracket than the other. This classification has a direct impact on the net value of the account. For example, if a couple is splitting a retirement account with an after-tax value of $200,000 and the spouses are taxed at different tax rates, they may net different amounts. One spouse may receive an equivalent after-tax value of $110,000 while the other receives a value of $90,000. After this transaction, each spouse would then take the required minimum distribution based on the share each party has in the retirement account.

Individuals going through divorce may decide to contact a divorce lawyer. An attorney may be able to provide advice about splitting marital assets that is based on the circumstances of the case.

No Comments

Leave a comment
Comment Information

Pride Law
957 Castle Shannon Boulevard, First Floor
Pittsburgh, PA 15234

Phone 412-254-3985
Fax 888-201-1071
Pittsburgh Law Office Map | Email