Founder and lead shareholder of Amazon.com Inc., Jeff Bezos, and wife, Mackenzie, have recently announced via social media that they will be divorcing after 25 years of marriage. Recognized as the wealthiest man in the world, Jeff Bezos possesses a net worth of nearly $137 billion, most of which he acquired during the course of his marriage. Many have been wondering what the outcome will be, considering that Bezos did not have a standing prenuptial agreement in place. As a result, the terms of their divorce may vary depending upon the state in which they dissolve their marriage.
With 2018 ending in a few weeks, unhappily married couples who are thinking of splitting up should consider the tax consequences of waiting until after the new year.
Under the new tax law enacted by Congress and the Trump administration, the rules regarding alimony will be different. Under the new law, the person who pays the alimony (otherwise known as maintenance in New York State) will no longer be able to write it off their taxes(deduct it from their income); meanwhile, those who receive alimony will no longer have to declare it as taxable income. If the paying spouse wishes to avoid this scenario, it is wise for to file for divorce before the end of the year. Those couples who already divorced will be grandfathered in — which means they will not be subjected to the new alimony law — unless they decide to modify their agreements next year.Continue reading “How New Tax Laws Will Affect Divorcing Couples in 2019”
The holidays are supposed to be times of joy, to be spent with loved ones, but when divorced parents try to determine who will enjoy parenting time with the kids, it can be a time of anguish and stress.
If the holidays come and both parents still cannot agree on custody and visitation, often the children caught in the middle of the verbal crossfire as the parents fight for time. Continue reading “Child Visitation and the Holidays”
President Donald Trump promised hefty tax changes prior to his inauguration. One substantial tax change under the Tax Cuts and Jobs Act concerned the deductibility of spousal support.
Prior to the enactment of the Tax Cuts and Jobs Act (TCJA), those receiving spousal support (alimony) were forced to claim the proceeds as taxable income, while those paying the alimony were allowed to deduct the payments from their taxes. However, under the new statute, it is reversed. Now, those that are receiving the alimony are able to deduct the alimony given by their former spouse from their taxes, while those paying the alimony will have to include it on their taxes. The change becomes effective after December 31, 2018.
Continue reading “Spousal Support Shift Under the Tax Cuts and Jobs Act”
Individuals in the Millennial generation (those born between the years of 1982 and 2004) are more apt to ask their significant others to sign and complete a valid prenuptial agreement prior to marriage. A prenuptial agreement, or “prenup” for short, is a legal contract that is established between future spouses to protect their property and assets, especially in the event of a divorce.
Millennials are much more cautious than their generational counterparts (Baby Boomers and Generation Xers) because many of them are children of divorce. They witnessed what their parents went through and desire to ensure financial security and protection of their interests. Also, by the time millennials have decided to marry, many of them have acquired assets, such as property, 401(k) retirement plans, stock options, among others that they now want to protect in the event that the marriage fails.
Continue reading “An Increased Number of Millennials are Asking for Prenuptial Agreements”
Going through a divorce or legal separation can be an emotionally taxing process, requiring the assistance of attorneys, mediators, and the state court system. Couples looking to divorce or separate must consider custody and visitation as well as how to divide the property they obtained together throughout the marriage.
Another important consideration while going through a divorce is the payment of taxes. As part of a divorce action, both parties are entitled to full financial disclosure. This means that each party must disclose all assets he or she has an interest in (including businesses) and debts. Often the financial documents for the business are combed through during the course of a divorce. Bearing in mind, a judge and your spouse can report any failure to report income or properly pay taxes, it is important to consult with your accountant in order to ensure you and your business are not at risk of exposure during the divorce process.
Continue reading “How the Court Divides Property During a Divorce”
Being self-employed during a divorce may lead to some contentious issues. For this reason, here are a few important tips to keep in mind:
Protect Your Assets and Resources
Be sure to maintain adequate income records if you are self-employed. A former spouse may allege that your income is greater than you are actually claiming. This may negatively impact your financial future, because you may then be required to pay more in spousal maintenance, among other things.
Continue reading “Getting Divorced While Working For Yourself”
An outdated law that prohibits the formation of parenting contracts and exchange of payment between a gestational surrogate and new parents is the subject of a repeal effort. The Consolidated Laws of New York: Domestic Relations law states in Article 8, section 123 that “no person or other entity shall knowingly request, accept, receive, pay or give any fee compensation or other remuneration, directly or indirectly, in connection with any surrogate parenting contract, or induce, arrange or otherwise assist in arranging a surrogate parenting contract for a fee, compensation or other remuneration.” This legislation has also prevented parents of a child born through artificial insemination and gestational surrogacy to establish a legal relationship as mother and father to the child.
Continue reading “Legal Protections for Gestational Surrogacy”
In New York State, one spouse may be required to pay spousal maintenance. Spousal maintenance is usually a monthly payment made from one spouse to the other spouse for a specific duration of time. The duration of time is determined by the following formula:
• If the length of the marriage was between 0 and 15 years, then the duration of maintenance is 15% to 30% of the length of the marriage;
• If the length of the marriage was between 15 and 20 years, then the duration of maintenance is 30% to 40% of the length of the marriage; and
• If the length of the marriage was more than 20 years, the duration of maintenance is 35% to 50% of the length of the marriage.
Continue reading “Judges Have the Discretion to Exceed the Maintenance Cap in High Net Worth Divorces”