Archive for the ‘Divorce’ Category

How the 2017 Tax Law Affects Spousal Support

Thursday, February 15th, 2018

By: Jeremy Forrest

You may be aware that Congress passed sweeping changes to the tax law in December 2017. The headlines for almost all news stories about the new law focused on reductions to both personal income tax rates and business income tax rates. Perhaps lost in the mix is an important change to the tax law that affects how spousal support payments are treated on an ex-spouse’s annual income tax return.

Under prior law, when an ex-spouse pays spousal support (“alimony”) to another ex-spouse under a divorce decree or separation agreement, the paying spouse can deduct those payments and the receiving spouse includes spousal support received as income. Congress made a complete reversal of this deduction rule in the 2017 Tax Bill. The new law provides that an ex-spouse paying spousal support cannot deduct spousal support payments from his or her tax return. Further, spousal support payments received are no longer considered income from the ex-spouse receiving those payments.

There are some important things to keep in mind about this change to the law. First and foremost, any existing divorce decree or separation agreement will remain subject to the old deduction rules. So if you are currently paying or receiving spousal support and those payments are going to continue into 2019 and beyond, those spousal support payments are subject to the old rules, where the paying spouse can deduct the payments on their income tax returns and the receiving spouse must include those payments as income received. Second, the new deduction rules take affect with any divorce decree or separation agreement that takes effect after December 31, 2018. Thus, any divorce decrees or separation agreements that take effect during the 2018 calendar year will be subject to the old rules. Lastly, because spousal support can be modified, if a spousal support order or agreement is subject to the old deduction rules, but gets modified after December 31, 2018, the modification will remain subject to the old deduction rules unless the order or agreement to modify “opts-in” to the new rules.

Contact us for more information

If you have questions about this, please contact the office of Beavers Law, P.C. at 757-234-4650 to schedule a consultation with one of our attorneys.  You can also visit us on the web at www.BeaversLaw.com.

Hers, Mine and Ours

Monday, June 5th, 2017

By: Shannon Forrest

Generally, if you were married when you acquired it – whatever the item is – it is marital property. There are exceptions to this rule, but not many. There may be different rules in other states, but this is the rule in Virginia. In other words, even if you have been working hard, received your wages and bought a “toy”, a motorcycle, for example, from your own paycheck, “half” of that motorcycle is still the other spouse’s.

Is it only in your name? Well, you’re married, so that title is a legal fiction. A Court may act much the way a Trustee does in a Bankruptcy, and change the title of the item, just so it is split equitably. “Equitably” means “fairly”, not necessarily 50:50. For example, the Court might look at why you are getting divorced, that is, the grounds for your divorce and distribute the property 30:70. In fact, the Court considers 11 factors when dividing property fairly.

This Rule is why, when an attorney hears you are getting married, he immediately mentions a Prenuptial Agreement. It is one of the few ways to preserve property that does not become “hers, mine and ours”.

A note about retirement. Retirement, earned during the marriage, is considered marital property, even if it is paid as monthly income. Generally, the Court awards half the “marital portion” of a spouse’s retirement. The “marital portion” is the total amount of retirement you earned during the marriage. The Court uses a special Order that allows companies to apply this formula to retirement accounts so that they are split fairly. Again, a retirement account is treated like a piece of property, and the general rule of “hers, mine and ours” applies to it.

DIY Separation Agreement: Don’t Let Your Divorce Become a Pinterest Fail

Thursday, March 23rd, 2017

DIY Divorce graphic

By: Shannon Forrest

Often when someone comes in to discuss a divorce, he or she will want to say that the divorce is “uncontested”.  It is no secret that an uncontested divorce costs a great deal less than a contested divorce.

Unfortunately, to have an “uncontested” divorce, you and your spouse must be in agreement as to all the divorce issues: fault grounds, spousal support, equitable distribution and the child issues of custody, visitation and child support.  If you and your spouse disagree about any one of these items, you do not have an uncontested divorce… yet.

To facilitate an uncontested divorce, where you and your spouse can come to an agreement, I usually recommend that you and your spouse negotiate and sign a separation agreement, specifically one drafted by an attorney.  Why an attorney?  In truth, if you and your spouse were to agree upon terms, written on a napkin, and sign the napkin, that would be a legally-binding document.  It may be hard to enforce in Court, though.

Additionally, what you may be agreeing to, and signing may be two different things.  For example, you or your spouse may agree that “wife can have the house”.  In husband’s mind, this may mean that wife pays the mortgage; in wife’s mind it may mean she “gets” the house after the husband pays the mortgage.  Without further clarification, “wife can have the house” does not say who will pay the mortgage, at all, so you are left without an agreement as to that point.  Another way this happens is when you agree to a legal term, and you don’t know what it means.  This most often happens when a couple agrees to “joint legal custody”.  What if “joint legal custody” means something other than what you thought you and the other parent were agreeing to?

Finally, an attorney can put into an agreement protections that might not have been there otherwise.  For example, how do you and your spouse go about modifying your agreement should circumstances change?  There’s a provision for that.  What if one of you drafted it and the other one felt pressured to sign it?  There’s a provision for that.  What if it was written in Virginia but you both live in different states now?  There’s a provision for that.  I am not suggesting that attorneys are not human, but many of the provisions you and your spouse may leave out come standard in attorney-drafted documents.

In sum, do not allow your divorce to become a Pinterest fail by drafting your own separation agreement, on a napkin or otherwise.  Hire a professional so that you know you are protected and that what you agreed to will become the basis for your divorce.

Can my spouse refuse to get a divorce?

Monday, November 25th, 2013

Sometimes I have people come into the office and they tell me that they want a divorce, but their spouse refuses.  Sometimes it is because of religious beliefs and sometimes just because they like things the way they are.  Or sometimes it is because the other spouse doesn’t want to share any of the marital assets.  And sometimes it is because the other parent thinks that staying together until the children are out of the house will be better for the children.

Whatever the reason, this is one version of a contested divorce.

In the past, one spouse could refuse to get a divorce, but that is no longer the case.  If one spouse wants a divorce, it will happen…eventually.  But it won’t necessarily happen quickly or inexpensively.

I’ve often seen a divorce take over 4 years to be completed and include numerous court hearings and very large attorney bills.

If you want to get a divorce, and your spouse refuses, you really need to have an attorney.  This is not a case you can handle on your own.

If you have questions about this, or any other legal subject, please feel free to contact the office at 757-234-4650 to schedule a consultation with an attorney.

Should I take a Polygraph?

Wednesday, October 2nd, 2013

Sometimes, I have clients come in who are adamant that they are not guilty and they will state ” I’ll take a polygraph that will prove I’m innocent! ”

A polygraph is a nice name for a lie detector test, and most people think they can ‘beat the test’ even if they are guilty. And sometimes, they really aren’t guilty of this particular accusation so they think they’re safe in taking the test.

The problem is that a polygraph has been proved to be ‘inherently unreliable’ and cannot be used in court.  It doesn’t really prove anything.

That part is fine.  What isn’t fine is that any statements you make during the interviews before or after taking the polygraph CAN be admitted into court.

Most of the time, the person taking the polygraph isn’t in custody, they came into the office to take the polygraph on their own and they are free to leave at any time, so the authorities don’t really need to issue any Miranda warnings, and they can ‘chat’ about anything.

Also, people use lie detector tests in cases other than criminal.  For example, sometimes people will be accused of adultery in a divorce case and they will agree to a polygraph to ‘prove’ they didn’t have an affair with someone.

My advice?  If you are ever in a position where you think you might want to take a polygraph to prove you’re innocent, just say no…..or at least contact an attorney and have the attorney with you when you go to take the test.  The attorney may be able to stop you from answering an ‘innocent’ question that might end up getting you into real trouble.

If you have questions about this or any other legal topic, please feel free to contact us at 757-234-4650 or visit our website at www.BeaversLaw.com.