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08/18/2014
 
Posted By: Ed Amaral
          If you are thinking it has come the time to file for divorce, or any other important family law matter, there are certain types of documents a spouse or parent should always bring with him or her when meeting with a lawyer for the first time.  Being prepared with these documents can assist an attorney in any initial consultation to better advise you with respect to your divorce or family law matter. So what should you bring with you?
 
1.      Important legal documents.  This includes marriage certificates and birth certificates.  If you are not yet divorced, but you have a prenuptial agreement or postnuptial agreement, you should bring this with you as well.  If you are already divorced, or never married, and there are existing court orders regarding your spouse or your children, you should bring any of the current court orders with you, as well as any related agreements, such as a Separation Agreement.
 
2.      Financial documents.  This includes recent paystubs.  You should bring at least one month’s worth of paystubs.  You will also want to bring your most recent tax return, including the supporting schedules and forms, including your W-2 or 1099.  If you have the current balances of your bank accounts, retirement accounts, and other investments, this can be helpful to the attorney as well.  Financial documentation such as this can assist an attorney in advising you with respect to any financial aspect of your divorce or family law case, such as alimony, child support, and division of assets. 
 
3.      Important documents specific to your case.  Is there anything else about your divorce or family law matter that the attorney should see?  Has your spouse recently posted something negative or incriminating on social media?  Do you have any photos or videos that are an important aspect of your case?  If you think there is something important about your case, make sure the attorney knows about it right away.
 
4.      Questions for your attorney.  For most people, meeting with a divorce or family law attorney is an overwhelming process.  You are at a stressful time in your life, and you need legal help to get through this hard time.  It can be confusing and mind-boggling, especially if you have never met with an attorney before and are not familiar with the legal process.  Thus, you are bound to have questions.  Prepare your questions in advance, and bring them with you to your meeting with the attorney.  The attorney will go through your case in detail, and if at the end, the attorney has not answered all your questions in discussing your case, make sure you ask the questions.  You want to be comfortable with the attorney who will be handling the case, so make sure all of your questions are answered and you understand and are satisfied with the answers.


08/14/2014
 
Posted By: Ed Amaral
          Both prenuptial agreements and postnuptial agreements can be valuable tools for spouses.  It can give guidance regarding the division of assets and support in the event of a divorce or a spouse’s death.  It gives some predictability and certainty, which is not always guaranteed in the circumstances of a divorce in which there is neither a prenuptial agreement, nor a postnuptial agreement. 
 
          However, to have this predictability and certainty, the prenuptial agreement or postnuptial agreement must be valid and enforceable under the law.  In a divorce proceeding, a spouse can seek to have the prenuptial agreement or postnuptial agreement invalidated by the court so that the agreement is not enforced.  If a judge determines that the agreement is invalid, and thus not enforceable, then the predictability and certainty the agreement maintained is gone.  One spouse may now get a greater share of assets or more support than originally agreed to by the parties. 
 
          Under Massachusetts law, there are some stringent requirements to making a prenuptial agreement or postnuptial agreement valid and enforceable.  In general, both prenuptial agreements and postnuptial agreements must be fair and reasonable for both parties.  Both parties must also sign the agreement freely and voluntarily, and not under duress or under false or fraudulent pretenses.  Also, there must be a full financial disclosure by both parties, so there is full transparency of what either party may be waiving his or her rights to, whether it is a specific asset, or some support from the other spouse. 
 
          Another important consideration a court will review is whether both spouses had their own independent attorney to counsel each spouse as to his or her rights and responsibilities under the agreement.  This is why it is crucial for engaged couples or already married spouses to each engage their own attorney.  Experienced family law attorneys understand the requirements for having a valid and enforceable prenuptial agreement or postnuptial agreement.  If one or both spouses attempt to enter into a prenuptial agreement or postnuptial agreement without the assistance of an experienced family law attorney, both spouses run the risk of the agreement being invalidated by the court in the future.


08/12/2014
 
Posted By: Ed Amaral
          When a spouse is going through a divorce, or a parent is going through a custody or child support battle, it can be a stressful time in that person’s life.  Navigating through the family court process can be confusing under the best of circumstances.  If the case is very contentious, then this only makes the circumstances worse. 
 
          A spouse or parent may think that since the case is about his or her life, who would be better to represent that spouse or parent but himself or herself.  However, when going through such a delicate time, in which there are rigid standards established by the law and the court, it is better for that spouse or parent to engage the assistance of a knowledgeable family law attorney to help that spouse or parent through the process. 
 
But what can a family law attorney do that the spouse or parent can’t do on their own?
 
 
1.      Remove the emotion from the case.  An attorney can approach the case with the emotion and stress removed.  An attorney is a neutral person coming into the case.  The attorney is required to zealously advocate for his or her client, but they can do so without getting caught up in the emotion of a divorce of family law case.  By its inherent nature, a divorce, child custody, child support, or any other type of family law matter is very stressful and emotional.  The other party is your spouse, the parent of your child, or some other family member.  It is impossible to not be emotional through this process.  An attorney can advocate for a spouse or parent in a level headed manner, putting the stress and emotion aside.  This way, a spouse or parent’s legal argument is conveyed in a cogent and articulate manner that is not caught up in the stress and emotion of the case.  Also, as an outsider, an attorney can give you an unbiased opinion of the case, and how to strategically maneuver through the case. 
 
2.      Draft legal documents and meet legal deadlines.  Many spouses and parents do not realize that if they represent themselves in court, they are held to the same legal standards as attorneys.  That means all of the legal deadlines must be met in a timely manner, and all documents submitted to the court or opposing party must comply with all the laws and court rules.  However, understanding these time standards, court rules, and the law in general is confusing to the average lay person.  If a spouse or parent fails to meet any of the deadlines, or does not comply with a rule, it could have disastrous consequences for his or her case.  Having an attorney represent you will alleviate this potential problem.  Attorneys understand the different legal deadlines, and how to draft the various legal documents.  They can ensure that the deadlines are met and the documents are drafted and filed properly.
 
3.      Argue your case in court.  Even oral arguments and testimony in court have stringent legal standards.  Having an attorney with you to argue your case can ensure that the testimony is properly heard by the judge, and that any evidence is properly entered into the court record.  Also, because the attorney a third party to the case, he or she can craft a legal argument to present to the court that conveys the importance of the case, but removes the emotion from the argument.  A lawyer can effectively convey a spouse or parent’s argument without potentially saying something that the spouse or parent may say out of stress or emotion that could, in fact, damage that person’s case.  Additionally, as a skilled attorney, your attorney will know how to best present your case in light of the specific facts and circumstances in the case.
 
4.      Conduct complex analyses and engage experts.  Some family law cases are very complex.  In divorces there can be a complex financial matter that requires an expert.  This can include a business appraiser if one spouse owns a business, a forensic accountant, if a spouse may be hiding assets.  For child custody cases, a Guardian ad Litem, parenting coordinator, or other expert may be necessary where the case is complicated or hotly contested.  Knowledgeable family law attorneys know when an expert is necessary in such cases, and which experts to engage.  The attorney can also assist the expert through his or her analysis, and point out important facts and documents the expert should be reviewing and considering.  Oftentimes these are very complex issues that the average lay person would not know how to analyze or address. 
 
5.      Draft a comprehensive settlement agreement.  In a divorce, when a case settles, spouses must sign a Separation Agreement to resolve and settle the case.  In other family law matters, such as child custody and child support, there are other agreements that must be drafted to settle a case.  These agreements are very comprehensive and oftentimes dozens of pages long.  An attorney has the knowledge of what provisions to include in the agreement to make the agreement detailed enough so that there is no ambiguity in the future.  This can avoid future headaches of going back to court for a modification or contempt action because certain provisions in an agreement were not sufficiently outlined.  If an agreement is drafted without the assistance of an attorney, both spouses or parents run the risk of having to come back to court in the future to enforce, modify, or clarify an ambiguous provision.


07/23/2014
 
Posted By: Leanne Leite
I'm living with my ex-husband again. It's not what you think.

When we married in the spring of 1998, before wedding registries were online and photos were still shot on film, our chances of staying together forever looked pretty darn good. Great, in fact. We were 26-year-old college graduates who had dated for four years, came from loving families and agreed on all of the basic fundamental issues in life.

Twelve years later, with a 4-year-old daughter, we split after two years of concerted effort to salvage our union that included couples therapy. We were the couple who still touched each other, talked to each other and spent time together. Our friends, neighbors and families were heartbroken, a couple to the point that they seemed more concerned with their own sadness than what was happening to us. But what hurt the most was the thought (spoken or not) that we were not considering our daughter and that our decision would cause her harm.

Neither were true. And, so far, we see no evidence of harm. Impact, yes. Harm, no. The impact hasn't necessarily been negative and, in some instances, arguably beneficial in terms of understanding human relationships and forgiveness. If the naysayers were to speak up now, they'd have to admit it, too (a couple of them have).

We divorced through mediation. We have no custody arrangement, no court-approved schedule or visitation, no alimony or child support.
We are still a family.

We both care for our daughter when she's sick, take her to the doctor, pay for camp, go grocery shopping and attend her Little League games. We still talk, touch (friendly hugs), and spend time together. Some may wonder why we are divorced. It's none of their business and I won't be writing about that because it wouldn't deliver anything beyond a story of how two people discovered they didn't want to be married. Some of that story is very ugly. The better story that serves more impact for other divorced parents now and in the future is this: Don't be nice for the kids' sake. Be nice for everyone's sake: the kids, yourselves, your neighbors, your families, your kids' teachers, your kids' friends. Everyone. Be the example that you would want for your kids.

Your marriage is over. However that happened, forgive each other. Revenge, money, houses and all that other stuff will not change that or make you feel better about that.

So, here I am, living with my ex-husband again, temporarily, while I'm in escrow on a house. My daughter is happy, confident, honest, healthy, and smart. She's doing well in school, has fabulous social skills, and participates in a club for kids with divorced parents. She was shocked to learn of kids with parents who don't speak, live in separate states and argued about their kids in court. I understand that sometimes those things are unavoidable. Many times, however, they most definitely can and should be avoided.

Do I wish my daughter had parents who were still married? Sometimes. Do I think my daughter would be a better, happier person if her parents were still married? Not at all.

I can't be sure what my daughter thinks. She's had a handful of sad moments about our divorce. Today, she says it doesn't matter. Tomorrow, who knows? She's 8 going on 18 in all the good ways and still a little girl in all of the best ways. Part of that maturity is nature. Part, perhaps, might be due to having divorced parents. Not a bad outcome and, arguably, beneficial.

I like to think my ex-husband and I are revolutionaries of sorts. We know very few divorced parents like us. We welcome more followers. And, I'm guessing, so do your kids.

Source; http://www.huffingtonpost.com/deanna-glick/post_7802_b_5488256.html


07/10/2014
 
Posted By: Leanne Leite
Slowly but surely, Massachusetts is reshaping its laws around divorce. First, a task force of experts and advocates prompted a sweeping overhaul of outdated alimony laws. And two years ago, the governor’s office convened a similar committee to review the state’s child custody laws. That committee’s work is done, and the result is promising: a proposal that acknowledges that, in most circumstances, children benefit from significant time with both parents. This would put Massachusetts in line with other states that are updating their custody laws, and is worthy of the governor’s support and the Legislature’s action.

The changes to state code, if passed, would directly affect only a small portion of divorce cases: the 10 to 15 percent of couples who cannot reach an agreement through negotiation or mediation, and instead rely on the courts. But child advocates say the changes would establish expectations for all splitting families, and set the tone for settlement negotiations, by prioritizing the well-being of children over the competing interests of the parents.

Significantly, the proposal would change some of the adversarial language that’s currently in state code, replacing “custody” with “residential responsibility” and “decision-making responsibility,” and replacing the loaded term “visitation” with the more neutral “parenting time.” A new mission statement would state that significant time with both parents, when possible, is ideal. And new language would suggest that, when possible, children should spend at least one third of the time with each parent.

Of all of the changes proposed, that idea — prescribing a specific amount of time with each parent — is most likely to face resistance. Some will imagine that constant travel between homes could be too disruptive for children. Others will be disappointed that the language doesn’t mandate a 50-50 split. But the task force proposal doesn’t dictate any specific sort of split. (Parents can divide up weekends and weekdays; summers and vacation weeks could work, too.) The guidelines are a way of acknowledging research that shows the value of quality time with both parents.

The proposed changes would still leave judges broad discretion to limit a child’s contact with parents in the case of domestic violence, substance abuse, and a range of other factors. Judges would be able to penalize parents for deliberately trying to alienate a child from a father or a mother. The need for such safeguards underscores a sad reality about divorce: There is no way to eliminate all acrimony from the process, or to shield children completely from disruption. But as a baseline effort to put the needs of children first, and to bring Massachusetts custody laws into the present, these changes are worth pursuing.

Source; http://www.bostonglobe.com/opinion/editorials/2014/05/17/massachusetts-custody-proposal-rightly-stresses-time-with-both-parents/T5OPqzdtmLzeGh4faIkmFL/story.html


07/07/2014
 
Posted By: Ed Amaral
Divorce and what leads up to it are not tidy and polite affairs. The children who bear witness to the demise of their parents' marriage inevitably get wounded -- some very deeply and invisibly at first. No matter how old a child is when his/her parents' divorce occurs, the child learns a life lesson about the shadow side of love and its potential impermanence. Learning this lesson through the end of your parents' marriage and perhaps the subsequent re-partnering of either or both parents, is confusing at best and life-threatening for young children who are dependent upon their parents for their very survival.

When we fall in love and marry, many of us have stars in our eyes and fantasize about living happily ever after. Then reality sets in and tests our ability to fulfill our vows to love, honor and cherish each other through the trials and triumphs of life. If we lived in a perfect world, love would last and be stronger than all the challenges that tear us apart. In reality, maintaining a loving relationship takes a lot of commitment, honesty, and vulnerability. It's not for the faint of heart.
As a child of divorce, a life coach, and an interfaith minister who officiates at many weddings, I do not think that divorce, in and of itself, is a bad thing. In fact, I wish my own parents had divorced much earlier than they did which would have spared us from living in a cold war of mixed messages at home that wore a public mask of a perfect family.

When a parent leaves, so does a part of the child -- we often hide the vulnerable and innocent parts of ourself to avoid dealing with our feelings and needs. We lack the personal resources to cope and our parents are too busy fighting, so most of us are left with the options of either expressing or repressing our emotions and fears. Hiding them is usually a safer bet.

These days most parents are too busy to be as attentive as their child(ren) need them to be when the family is falling apart and the kids are too often left to fend for themselves. However, this is a crucial time for a child. No matter how young or grown a child of divorce is, he or she has probably internalized some deep lessons that may remain as an unconscious filter through which he or she experience the rest of their life unless and until becoming aware of those messages and developing a realistic and healthy understanding of the matter. The two most dominant messages that kids of divorce internalize are believing that their parents' divorce is somehow their fault and that love is conditional and might not last. Let's take a closer look at both of these messages.
Younger children tend to be more susceptible to thinking the divorce is their fault. "If only I hadn't ... then Mommy and Daddy would still be together" is what many kids tell themselves. Some try to "fix" the situation by being on good behavior, imagining that doing so will be all that is needed to bring the parents back together so they can live happily ever after as a family. Even after the parents are officially divorced and are living separately, many children fantasize about what they can do to get their family back together again. For a child who thinks his or her bad behavior is responsible for the parents splitting up, it makes sense that they think their good behavior might reunite them and that their bad behavior might stave off a new suitor.

The second dark message many children of divorce hear is that love is conditional and does not last. 'You loved my Mommy or Daddy, then he/she did something you didn't like and now you are divorced. I better be careful or you'll divorce me too." We want our children to believe that our love for them is unconditional, but divorcing their other parent gives them a mixed message.

When we internalize the message that love doesn't last, we learn to protect ourselves from getting hurt by not getting too close to anyone. We may evolve a survival strategy of avoiding intimacy - especially emotional intimacy as a way to avoid the vulnerability of ever feeling so powerless and devastated again. We may keep to ourselves or choose to use other people without actually bonding with them.

What can parents do to help their children thrive rather than hide when the family is breaking apart?
  • First, don't assume that reassuring your child that you love him/her is enough.
  • Know that no matter how careful you might have been not to fight in front of the children, they saw and heard and felt their family falling apart and had no personal resources to do anything about it.
  • Know that no matter whether they act out or put a smile on their face, their world is falling apart too.
  • Take lots of time with them to help them draw out their deeper feelings and needs. Talk to them. Listen deeply. Use forms of creative expression to draw out their deeper truth. Go for counseling together. Reach out to their teachers and guidance counselors to help you watch for signs of distress. Check out books and websites on the topic.
  • Keep the lines of communication with each child strong and open on a daily basis and keep a loving connection with them throughout their adulthood. Make a commitment with your X to both do this for each child and to not interfere with each other doing so.
  • If the child acts out, make sure that your reaction communicates that your love is not conditional based on their behavior - i.e. "I love you and will always love you, but I will not accept that behavior."
  • Never complain to the child about the other parent.
  • Never let them see or hear your judgment of the other parent. For the sake of the children, please play nice with your X when coordinating care and decisions regarding the children.
These days most parents are too busy to be as attentive as their child(ren) need them to be when the family is falling apart and the kids are too often left to fend for themselves. The health and well-being of your children is your responsibility until they are able to take care of themselves. Pay attention and be sure they feel your love no matter what.

Source; http://www.huffingtonpost.com/judith-johnson/getting-divorced-what-can-divorce_b_5411930.html


06/25/2014
 
Posted By: Ed Amaral
In my last two columns, I addressed the grief and loss process experienced by couples during separation and divorce. But what do the children experience? At a time when so many marriages fail, it is important to understand how youngsters are affected by the loss.
Children of divorcing parents go through the same four stages of the loss process that their mothers and fathers do. Youngsters initially feel shock and denial as their parents do. Then they experience the anger-sadness-depression stage. This is usually followed by acceptance and understanding and lastly, children move into the phase of growth and emotional healing.
Since they do not have the advantages of maturity, however, children respond in a much more unconscious and fearful way. Because they are so dependent on the family unit, young people do not really believe they could lose their parents. Feeling that they can always count on the love and continued presence of Mum and Dad is important to their sense of security. On an emotional level, the “loss” of one parent opens up the possibility of losing both. This can be a terrifying prospect for kids. They need as much emotional support as their parents do to move through their grief and fear. Sometimes children who have particular difficulty with this may need professional help.
When one parent leaves the household, children may react with added hostility toward the remaining parent. There are several reasons. In the mind of a child, it is safer to express anger at the remaining parent because he or she has not left them. So, conversely, children will often be on their best behavior with the “lost” parent — the one who left the household. Feeling deeply rejected initially by that parent’s leaving, the young ones do not want to risk any further rejection. This can also be behavior that is an attempt to win the parent back.
A child’s anger may also be expressed at either or both parents simultaneously. It may also manifest more indirectly: a child may run away or misbehave at school. He or she might fight with friends. Depression may affect a child’s interest in school work and outside activities. Regression is probably the most easily recognizable symptom. A 7-year-old, for example, may start sucking his thumb again or want to share a bed with the remaining parent. This is often particularly the case at the beginning stages of the separation process.
It is crucial to children’s well being that they be treated in a loving, gentle, and honest way. When the time comes to tell the children about the divorce, it is extremely important that they understand that the breakup is not their fault, and has absolutely nothing to do with them or anything they did or did not do — “If only I had gotten better grades, or played better baseball, etc.” They need to be told that the divorce is strictly between Mum and Dad. Children need reassurance that both parents still love them, and will still be involved in their lives. Parents should answer questions and give explanations as honestly as possible without getting into unnecessary details. Give an honest answer if asked “Will you get back together?” If the true answer is a firm “No” then reinforce the idea that, no matter what happens, both parents love the child and will be in their lives. If one parent wants to remove him or herself entirely from the family, then that issue has to be dealt with great care.
Youngsters need to know about practical issues: what school they will be attending, where they will be living, when they will visit or live with the absent parent. If possible, it is best for changes in these circumstances to be made slowly avoiding drastic changes.
If you are in the throws of this life altering situation you may want to do some reading and talking with other parents who may be coping with similar circumstances.
Children’s experience is greatly impacted by how both parents behave in their own lives and how they are treated by them. This enormous life upheaval can stir up old emotional issues, and all family members will be stricken with grief. If you find that you or anyone else in this situation is struggling, and not moving through the stages of grief, then I would suggest that you seriously consider seeking professional support.
Source; http://www.gloucestertimes.com/lifestyle/x2117335788/Children-of-divorce-grieving-their-losses?zc_p=2


06/23/2014
 
Posted By: Ed Amaral
Researchers estimate that about 50% of American marriages end in divorce. They also say that 62% of American households include at least one pet. So, it seems reasonable to conclude that many divorcing couples are pet owners. But when a married couple calls it quits, what happens to their furry friends?

Sometimes, the decision isn’t made without a fight – even to the point of judicial intervention. The American Academy of Matrimonial Lawyers reports that in recent years, pet custody disputes are reaching courtrooms more and more often.

My wife and I have been pet owners for most of our marriage, so I know how easy it is to develop strong feelings about questions like “Who will keep the dog?” (Dogs are reportedly the most frequently disputed family animal; cats are a distant second.) We humans develop very close and unique bonds with our pets, and many consider them members of their families – which is precisely why an unscrupulous soon-to-be-ex-husband will try to use the family pet as a bargaining chip in divorce.

If you have a strong emotional attachment to your pet, your husband likely knows it – and he may try to use it against you. Knowing how devastated you would be to lose the pet, your husband might threaten to pursue custody himself, hoping that you’ll give up something with significant financial value in order to get him to drop the demand. It’s a kind of emotionally based extortion that divorcing women know all too well.

I understand, and I realize it’s very hard to Think Financially, Not Emotionally™ about your pet. There’s no dollar value to be placed on the benefits of pet ownership. Women should be aware that their husbands might try to use that to their advantage, and be prepared with a strategy of their own.

So how are pets handled in divorce?

You may view your dog or cat as a member of the family, but in the eyes of the law, your pet is personal property, plain and simple, just like paintings and patio furniture. (Note: If you or your spouse breed and sell animals, your pets could also be considered business assets. Some purebreds sell for significant sums.)

Because a pet is legally considered personal property, that means that you can use a prenuptial agreement to ensure that your pet will stay yours, no matter what happens in the future of your marriage. However, if it’s past time for a prenup, consider including provisions for your pet(s) in a postnuptial agreement.
If it’s also too late for a postnup, and your husband is using your pet to try to force your hand in the divorce process, use a common sense strategy to fight this tactic. Keep in mind: The facts may be on your side. Here are a few of the questions a court might try to have answered in pet custody cases:

Whose pet is it?

If the pet belonged to either spouse before the marriage, the case is much clearer that it should belong to that same spouse after the divorce.

Who cares for the pet?

Who buys the pet food and supplies? Who takes the pet to the veterinarian for check-ups, or if it’s hurt? Who walks it, cleans up after it, feeds it? If the answer to these questions is you, then you can gather evidence to make your point. Ask your vet to sign a statement acknowledging that it is you, not your husband, who brings the animal in for check-ups and treatments. Ask a neighbor to attest to the fact that it is you who regularly walks the dog. Save pet supply store receipts with your signature on them. Who signed the application for the dog license – was that you, too? Get a copy from your city clerk. It can all go in the file to make your case that as primary (or sole!) caretaker of your beloved animal, you deserve to have him live with you after your divorce.

Where are the children going to live?
If there are children involved, and the pet is truly a family pet, then sometimes it’s best for everyone to have the pet live with the kids. If custody of the children is shared, perhaps custody of the dog can be shared, too. (I have a feeling this wouldn’t go over so well with cats, but stranger things have happened.)

Whose life is better suited to pet ownership?

If your husband works long hours, travels often and on short notice, while you work from home or have a predictable schedule, you can make the point that your lifestyle is better suited to providing a good environment for a pet. You can clearly demonstrate that living with you, the animal would not often be left alone or cared for by strangers. Pets do well with consistency and lots of positive interaction with their humans.

Prepare a well-reasoned, factual statement with ample documentation, and make your case to keep your pet. Divorce takes place in a dog-eat-dog world, but remember, judges have pets, too. If your husband is blatantly exploiting your emotional bond with a pet to coerce you into giving up something he wants, he should be prepared for a judge to call that out for the nasty, underhanded tactic it is.

Source;  http://www.forbes.com/sites/jefflanders/2014/04/17/how-are-pets-handled-in-divorce/


06/18/2014
 
Posted By: Ed Amaral
According to the Journal of Accountancy, the IRS has increased resources devoted to scrutinizing alimony.

As is well known amongst divorcing individuals and financial professionals, the tax code allows the payor of alimony to deduct it from taxable income, while the recipient must include it in taxable income. So if Kevin pays Kate $30,000 of alimony a year, he can reduce his taxable income by $30,000 while she is supposed to claim $30,000 as income on her tax return, and pay taxes.

Unsurprisingly, divorced couples don't agree about alimony any more than they do about anything else. In March 2014, TIGTA, an IRS watchdog, issued a report identifying a large tax gap between alimony deductions by payers and the corresponding income claimed on ex-spouses' returns.
Titled “SIGNIFICANT DISCREPANCIES EXIST BETWEEN ALIMONY DEDUCTIONS CLAIMED BY PAYERS AND INCOME REPORTED BY RECIPIENTS” (with the ominous all upper case and bold style on the cover), the report found that for the 570,000 returns that they analyzed for the tax year 2010, deductions exceeded income by more than $2.3 billion. More than 47% of returns showed discrepancies between the alimony payments deducted and the income reported.
According to Mike Conti, a CPA in Boston, TIGTA estimated that the IRS revenue loss from alimony errors could add up to $1.7 billion over a five year period. Although that is small compared to the estimated $385 billion tax gap, Mike Conti points out that alimony is now a target that the IRS has identified and quantified.

In fact, the IRS reported adjusting its audit filters to catch more high risk returns. According to the agency it is developing “other strategies” to address the alimony tax gap. In other words, divorcing individuals, at least those paying and receiving alimony, will be at a higher risk for an audit.
Divorces are messy enough as they are that a potential IRS audit may not make it to the top of the list of concerns. However, given that it is now completely predictable, it is better for divorcing individuals to pay the extra attention and avoid the audit or be ready for it.
For people paying alimony as well as for those receiving it, it is important to ensure that:

1) You fully understand what is alimony and what is not. Separation agreements are written in a legal style that is not always clear to non-lawyers. If you are not sure, if you have questions check with your lawyer or a financial specialist such as a CFP® professional, a Certified Divorce Financial Analyst (CDFA) or a CPA.
2) You agree with your ex on what alimony amount you are putting on your respective tax returns. Having a discrepancy between what he files and what she files could put both of you at greater risk for an audit.
3) Your separation agreement correctly specifies alimony. If it does not and you get audited, alimony could get disallowed. If you have not done so already, take the opportunity to verify that your separation agreement correctly specifies alimony.
4) You get proper professional post-divorce support. You will need it anyway for any number of other issues. Analyzing alimony and filing taxes correctly are just two of them.
5) You avoid pushing the envelope on this issue. It is simply not worth the additional aggravation.
Financial Planning Association of Massachusetts member Chris Chen, CFP ®, CDFA™ is the principal of Insight Financial Strategists, LLC a Registered Investment Advisor in Waltham, MA specializing in retirement planning and divorce financial planning.
The information contained in this article is not tax or legal advice. If you feel that it may apply to you, consult with a qualified professional.

Source : http://www.boston.com/business/personalfinance/managingyourmoney/archives/2014/05/the_irs_thinks.html



06/16/2014
 
Posted By: Ed Amaral
According to the Journal of Accountancy, the IRS has increased resources devoted to scrutinizing alimony.

As is well known amongst divorcing individuals and financial professionals, the tax code allows the payor of alimony to deduct it from taxable income, while the recipient must include it in taxable income. So if Kevin pays Kate $30,000 of alimony a year, he can reduce his taxable income by $30,000 while she is supposed to claim $30,000 as income on her tax return, and pay taxes.

Unsurprisingly, divorced couples don't agree about alimony any more than they do about anything else. In March 2014, TIGTA, an IRS watchdog, issued a report identifying a large tax gap between alimony deductions by payers and the corresponding income claimed on ex-spouses' returns.
Titled “SIGNIFICANT DISCREPANCIES EXIST BETWEEN ALIMONY DEDUCTIONS CLAIMED BY PAYERS AND INCOME REPORTED BY RECIPIENTS” (with the ominous all upper case and bold style on the cover), the report found that for the 570,000 returns that they analyzed for the tax year 2010, deductions exceeded income by more than $2.3 billion. More than 47% of returns showed discrepancies between the alimony payments deducted and the income reported.
According to Mike Conti, a CPA in Boston, TIGTA estimated that the IRS revenue loss from alimony errors could add up to $1.7 billion over a five year period. Although that is small compared to the estimated $385 billion tax gap, Mike Conti points out that alimony is now a target that the IRS has identified and quantified.

In fact, the IRS reported adjusting its audit filters to catch more high risk returns. According to the agency it is developing “other strategies” to address the alimony tax gap. In other words, divorcing individuals, at least those paying and receiving alimony, will be at a higher risk for an audit.
Divorces are messy enough as they are that a potential IRS audit may not make it to the top of the list of concerns. However, given that it is now completely predictable, it is better for divorcing individuals to pay the extra attention and avoid the audit or be ready for it.

For people paying alimony as well as for those receiving it, it is important to ensure that:

1) You fully understand what is alimony and what is not. Separation agreements are written in a legal style that is not always clear to non-lawyers. If you are not sure, if you have questions check with your lawyer or a financial specialist such as a CFP® professional, a Certified Divorce Financial Analyst (CDFA) or a CPA.

2) You agree with your ex on what alimony amount you are putting on your respective tax returns. Having a discrepancy between what he files and what she files could put both of you at greater risk for an audit.

3) Your separation agreement correctly specifies alimony. If it does not and you get audited, alimony could get disallowed. If you have not done so already, take the opportunity to verify that your separation agreement correctly specifies alimony.

4) You get proper professional post-divorce support. You will need it anyway for any number of other issues. Analyzing alimony and filing taxes correctly are just two of them.

5) You avoid pushing the envelope on this issue. It is simply not worth the additional aggravation.

Financial Planning Association of Massachusetts member Chris Chen, CFP ®, CDFA™ is the principal of Insight Financial Strategists, LLC a Registered Investment Advisor in Waltham, MA specializing in retirement planning and divorce financial planning.
The information contained in this article is not tax or legal advice. If you feel that it may apply to you, consult with a qualified professional.
 
Sourcehttp://www.boston.com/business/personalfinance/managingyourmoney/archives/2014/05/the_irs_thinks.html


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