March Madness: Why Divorcing Couples Often Choose March to File for Divorce
For many, March is the month couples conclude their marriage. March is infamously known as “divorce month” in family law circles. Statistics show that rates spike in the early months of the year, peak in March, then subside, and rise again in August when children return to school.
Why March?
The reasons for the March Madness up-tick in divorce are varied.
The holidays often prove to be a tipping point. While many wish to avoid breaking news of divorce around the holiday dinner table (especially when children are involved), fresh resolve to part ways may emerge in the new year. For some, it’s a New Year’s resolution. Others decide never to spend another unhappy Valentine’s Day. Frequently it’s a slow and steady progression. A couple resolved to divorce in the new year will consult with a mediator or lawyer usually around January, plan in February, and take legal action in March.
Tax Season often brings financial clarity and flexibility.
March is also a practical time to divorce because accounting is easier. As couples gather their tax forms to file, they have a clear financial picture from the prior year. Indeed, form gathering required for tax preparation is similar to what is required to file for divorce. In most states, the amount of support paid (child support or spousal) will be informed by the reported income from the prior year, thus assisting divorcing couples. Should a couple receive a tax refund, it allows them to more easily afford the costs of divorce than any other time of the year.
Strategic Planning
The propensity to divorce in March may also be strategic. Until an individual files for divorce, assets and debts accumulated by either spouse in most states is presumed to be marital property. But asset accumulation is reclassified as separate once legal action is taken – or in some states when the couple formally separates. Therefore, if a couple already know they want to divorce in the coming year, there can be motivation – especially among high-earning spouses – to stop the clock on martial asset accumulation earlier in the year rather than later.
IRS Requirements
Divorcing earlier in the year is also important for tax liabilities. In the eyes of the IRS, your marital status on December 31st determines how you may file your tax return. Thus, if you want to be divorced by the end of the year, consider withholding taxes at a rate that comports with your anticipated filing status. For example, you may not want to withhold taxes at a more lenient “married filing jointly” rate throughout the calendar year, only to be hit with additional tax liability next April when you file at the “single” tax rate. Filing earlier in the year may also increase your odds of obtaining “head of household” tax filing status – which affords a more generous standard deduction. In all cases, you certainly want to consult with a tax advisor. If employed, you may need to file a new Form W-4 with your employer to change your withholding status.
Peak Real Estate
Another consideration is the timing of home sales. If you’re getting divorced and know you’ll likely need to sell the marital home, March can be a strong time to take action to get the house on the market by the spring.
March Madness
The “March Madness” phenomenon, experienced by so many divorcing couples, is due to many considerations and motivations – but might primarily be attributed to a desire to act earlier in the year before another calendar year passes. And for couples seeking greater control and efficiency and wanting to avoid “madness,” mediation can be an ideal method to conclude their marriage.