How to Divorce -- Taxes

How to Divorce – Taxes

Not many divorcing couples focus on the tax ramifications of a divorce.  In particular, if there are children involved, who gets the tax deduction for the child or children.  Some states provide that the tax deduction should be rotated on an annual basis between the parties.  This, however, creates a conflict with the federal mandate that the tax deduction should go to the party with whom the child or children have resided for the majority of the year.  In other words, the party with sole physical custody should always have the tax deduction.  

Some states further require that in order to claim the deduction, a part must be current on their domestic support obligations.  What is unclear is whether the party must only be current during the current tax year or have no arrearages whatsoever even from previous years.  This can create a situation where a party falls behind and may never be able to claim the tax deduction.  

There are several options for claiming the tax deduction on a rotating basis when more than one child is involved.   These options include splitting the tax deduction between the parties with each person claiming a child or if there are an odd number of children rotating the deduction on an annual basis for the odd child out.  Some parties also like to add provisions permitting the other party to buy out the deduction if they would receive a greater tax return.  This of course requires cooperation between the parties and the sharing of sensitive information.

With respect to the divorcing couple, they will need to decide whether they want to file jointly, married but filing separately or separately depending on the circumstances.  Each spouse must also be careful if the other spouse is preparing the taxes so that they do not get caught up in any issues with the IRS.    

How to Divorce -- The Cost

        The Cost of Divorce

A divorce can be expensive.  A divorce is filing a lawsuit and then pursuing it to the end, which may mean going to trial if the parties cannot agree.  In Utah, there is a $318 filing fee that will be paid to the court unless you qualify for a fee waiver.  A fee waiver may be obtained in whole or in part if you are low income and file the proper documents.  In addition to a filing fee, there is a fee associated with serving the other party with a summons.  This fee generally ranges from $45 to $75 with extreme cases costing several hundreds of dollars (especially when process must be made by publication). 

Because filing and trying a lawsuit is very expensive, you will need to scrutinize the issues at a very early to determine what issues can be settled and what issues need to be litigated, if any.  By far, the most expensive cases are those involving custody of children or when a party is self-employed.  Mediation is an additional cost as you will be required to pay a mediator (as well as your attorney) an hourly fee for mediation generally ranging from $100 an hour to $200 an hour for the mediator.  You may be able to qualify for a reduced rate through the Utah Dispute Resolution Center. 

Keep in mind that at all points of your case, you do exercise control over the issues.  Thus, if you can make a concession that would bring your case to a speedy conclusion and thus reduce your legal fees, please consider making such concession.  Litigation often begets further litigation, which often means only the lawyers win.

Of course, I have only addressed the financial costs and not the physical and emotional costs that go with a divorce.

If you have any questions, please contact Attorney Drew at www.attorneydrew.com or andrew@gillilandlaw.com.

How Long to Divorce?

How long will my divorce take?

            Being in the middle of a divorce is never a fun experience. In spite of the few individuals who love battling it out with the former spouse, most individuals want the divorce over as quickly as possible.  An attorney’s experience often can help in determining the length of the divorce and there are various factors that must be considered.  These factors include the following:

1)         The type and complexity of the contested issues.  When custody is the issue, the divorce usually takes longer as a child custody evaluator may need to be involved.  Self-employed spouses also increase the time of a divorce due to the necessity to conduct complex discovery to determine the actual income.

2)         The intensity of feelings between the parties and whether there is an inclination to settle.  This tends to be the factor that drags out a divorce especially when there has been infidelity.  Unfortunately for the parties, the lawyers tend to benefit most from this type of litigation as their fees increase significantly without having to add too much substantive work. This is especially true in states (like Utah) where mediation is required as the actual mediation tends to be a waste of time, but the lawyers still get paid.

3)         The tenacity and desire for litigation of the lawyer of your spouse. Some lawyers just like to litigate and lose focus on the parties and finding a workable solution for the parties.  This is often unfortunate in a divorce with children as the parties will have to deal with each for years to come and the lawyer walks away.  Care must be taken in the selection of an attorney to make sure that if you are inclined to work out a resolution, you should find an attorney who is willing to do so as well.

4)         Does your state have a minimum waiting period?  In Utah this period is 90 days.

For more information please visit Attorney Drew at www.attorneydrew.com

How to Divorce -- Depositions

DEPOSITIONS

            Either party make may a demand to take the deposition of the other party or third party during a divorce proceeding.  You should understand that a deposition is an important part of a divorce action and you should prepare for it. 

            Opposing counsel has to schedule your deposition.  There are certain procedures and  pitfalls to avoid.

1. WHAT IS A DEPOSITION?  A deposition is your testimony under oath usually taken with an official court reporter that records the proceedings and all questions and answers.  Opposing counsel gets to ask the questions and your attorney can offer objections.  The judge will not be present.  Usually, the deposition is taken in one of the attorneys’ offices or at a court reporter’s offices. 

2. THE PURPOSE OF A DEPOSITION.  There are four main reasons for that the opposing side would want to take your deposition:

a.       To discover what facts you have in your actual knowledge and possession about the issues in the case.  In other words, they want to know what your story is and what it will be at the time of the final hearing.

b.      To pin you down to a specific story.  This way you will have to tell the same story at the final hearing.  Through a deposition, they will know in advance what your story is going to be.

c.       To catch you in a lie to show at the final hearing that you are not a truthful person.  This will cast doubt on your testimony, particularly the crucial and contested points.

d.      To make you nervous or stressed out about giving your testimony in court by asking you uncomfortable and probing questions.

These are very legitimate purposes and the opposing side has every right to take your deposition.  Correspondingly, you have the same right to take depositions of the opposing party and all witnesses.  These are decisions that you will need to make with your attorney.

For more information call Attorney Drew at (801) 871-2240 or visit www.attorneydrew.com

How to Divorce -- Counseling

COUNSELING

            Divorce and custody cases are often extremely emotional.  This is especially true when there has been infidelity or abuse in the relationship.  The divorce process is often about control, can be emotionally taxing, and often takes parties outside of their comfort zone.  For these reason, you should consider seeking counseling before or during the legal process.

           

            Finding the right counselor is always the tough part.  Obviously, you will first need to consult with your insurance company to find out if such counseling is covered and if there are any preferred providers.  If you do not know where to begin, your attorney can often recommend qualified counselors.  Your social or religious contacts also might provide leads. 

           

            When you choose a counselor, be picky.  Therapists have different styles and approaches.  Inform the counselor at the first meeting about the goal of the session.  Also check your health insurance policy to see if your plan covers any part of the cost.  You also need to make sure that the therapist is willing to testify if mental health becomes an issue in the case.  However, you should not approach counseling simply as litigation strategy or be concerned about what your counselor will say in court.  As a general rule communications between a counselor and patient for therapeutic reasons are considered privileged and not admissible as evidence. 

           

            Counseling often can help you through this difficult time.  If you have children, in Utah you are required to attend a class called Divorce Orientation Courts for Parents as soon as possible after the Petition for Divorce has been filed and prior to finalizing your divorce.  Failure to attend can lead to a charge of contempt and a hefty fine.  For information about this class, please call (801) 578-3800 or visit http://www.utcourts.gov/specproj/dived.htm.

            For further questions, call Attorney Drew at (801) 871-2240 or visit www.attorneydrew.com.