It is not a secret that the tax code and other laws are not always written in the best way to facilitate marriage in Alabama. Sometimes, married couples end up concluding that they are better off financially if they are no longer married. Some married couples contemplate divorce in order to increase their chances of receiving Medicaid or financial aid for college.
Tax laws have changed in a manner that has largely eliminated the so-called “marriage penalty.” However, there are still various ways that a couple could benefit financially from a “strategic divorce.” There may be some benefits of showing lower assets as a newly single person.
One of the major areas where this is relevant is the costs of long-term care as someone ages. Some married couples are forced to put their assets in a trust so that they can qualify for Medicaid and not have their life savings eaten up by the costs of nursing home care. Now, some couples are considering divorce as a way of showing lower assets so that one spouse’s care can be paid for by Medicaid.
Even earlier in life, the costs of maintaining two households can persuade colleges to give more money in financial aid to assist with the high costs of college tuition. Paradoxically, some laws still do not support continued marriage.
While no one is advocating that married couples get divorced to save money, those who want to explore what divorce will mean for them financially may want to consult an attorney as there may be compelling reasons for the divorce. The lawyer may explain what the ramifications are and any possible benefit that may be realized. The attorney may also help structure this strategic divorce in a way that will qualify one or both spouses for the maximum amount of financial benefits possible.