Financial Considerations During Legal Separation in Missouri

Division of Assets and Debts

One of the most significant financial considerations during legal separation is how assets and debts will be divided. In Missouri, this is done according to the principles of “equitable distribution,” meaning the division should be fair but not necessarily equal. The court will evaluate factors such as:

• The length of the marriage.
• Each spouse’s financial situation.
• Contributions to the marriage, including non-financial contributions such as homemaking or child-rearing.

It’s essential to keep track of marital and non-marital property. Marital property, acquired during the marriage, is subject to division, while non-marital property, such as gifts or inheritances, typically remains with the original owner.

Spousal Support (Maintenance)

During legal separation, the court may order one spouse to pay the other spousal support (or maintenance). Missouri courts will consider several factors when deciding the amount and duration of spousal support:

• The length of the marriage.
• The financial needs of both spouses.
• The ability of the paying spouse to provide support while meeting their own financial needs.
• The standard of living during the marriage.

Spousal support during a legal separation functions similarly to divorce, though the arrangement may be temporary or subject to review as circumstances change.

Child Support and Custody Arrangements

Child support will be determined as part of the legal separation if children are involved. Missouri uses a standardized formula to calculate child support, taking into account:

• Each parent’s income.
• The amount of time each parent spends with the child.
• Expenses related to the child’s care include health insurance, education, and extracurricular activities.

Legal separation does not alter the court’s focus on the child’s best interests. Custody arrangements will also be decided, either through negotiation between the parents or by court order. These arrangements can be modified later if circumstances change.

Tax Considerations

Filing taxes during a legal separation can be complicated. Since legal separation does not end the marriage, the couple remains married in the eyes of the IRS. You and your spouse can choose between filing jointly or separately. Each option has its pros and cons:

• Married Filing Jointly: Typically results in lower taxes but requires cooperation between spouses.
• Married Filing Separately: Protects you from being liable for your spouse’s tax issues but often results in a higher tax bill.

Discussing your tax situation with a financial professional to determine the best approach for your unique circumstances is essential.

Health Insurance Coverage

One significant advantage of legal separation over divorce is that it may allow one spouse to stay on the other spouse’s employer-sponsored health insurance plan. Many employers require a divorce decree to terminate health insurance benefits, so a legally separated spouse might continue to receive coverage. However, this depends on the terms of the health insurance plan and the employer’s policies.

Retirement Accounts and Benefits

During legal separation, retirement accounts and benefits may be treated similarly to how they would be in a divorce. The court may divide retirement accounts such as 401(k)s, IRAs, or pensions. It’s crucial to understand that retirement assets accumulated during the marriage are considered marital property and may be subject to division.

If you are legally separated but not divorced, you might also retain spousal benefits from Social Security, depending on the length of your marriage and other factors.

Handling Joint Debt

If you and your spouse have accumulated joint debt during your marriage, handling that debt during legal separation can become a significant concern. The court will determine how this debt is divided, but taking steps to protect your financial well-being is essential. For example:

• If one spouse is responsible for paying a particular debt, ensure that you are removed from joint credit cards or loan agreements to avoid liability if the debt is not paid.
• Monitor credit reports to ensure your spouse’s financial actions don’t negatively impact your credit score.