DIVORCE

Divorce in Russia and American Pre-Nup

Each party of an agreement has a right to dispute the agreement.

Although on practice it's unlikely to do if there was no violations while concluding the agreement.

According to the Article 161 of the Family Code of the Russian Federation, the spouses' property rights and duties are defined by the law of the country where they have common place of living. In case of absence of the common residence, the jurisdiction is the country of their last common place of living. Property rights and duties of those spouses who did not have a common place of living are defined in the territory of Russian Federation by the law of Russian Federation.

By concluding pre-nuptial agreement, the spouses who do not have common citizenship or common place of living, can choose the law to be applied to define their rights and duties according to the pre-nuptial agreement. Please note that it is said in your agreement. In case when the spouses did not choose the applied law, there will be provisions of ...

A FAMILY LAWYER COULD BE CONSIDERED BY IRS TO HAVE BECOME A TAX RETURN PREPARER

Consider that you have prepared a MSA that includes payments from husband to wife that are to be reduced when one of the minor children attains majority. The MSA does not state that any part of the payment shall be non-taxable to the wife and non-deductible to the husband. The client calls you one April afternoon and asks if under the MSA you drafted for him, he may deduct the all of the payments he has made to the wife in the previous year. You tell him – yes – since the agreement did not expressly make the payments non-taxable or non-deductible. The client deducts all of the payments, is audited and the amount of alimony reduction keyed to the child reaching majority is disallowed as being disguised child support. The client tells the agent that “my divorce lawyer advised me that I could deduct all of the payments.”

Surprise, surprise, surprise! Under amended Section 6694 of the Internal Revenue Code, you literally could be considered a tax return preparer if the amount o...

IRS CAN COLLECT TAX FROM PROCEEDS OF SALE BY WIFE OF PROPERTY FOR HUSBAND’S SEPARATE RETURN TAX DEBT – TAX LIEN AS TO HUSBAND ATTACHED TO TENANTS BY ENTIRETIES PROPERTY TRANSFERRED TO WIFE BY QUITCLAIM DEED.

It was pretty well accepted by family lawyers that a safe harbor for income taxes of a divorcing spouse was to elect the status of a married person filing separately. In that case it was thought the electing spouse was freed from tax liabilities arising from the improprieties of the other spouse without having to resort to the shaky, factual laden, desperation defenses of innocence found in IRC Section 6015. If in doubt file a separate return, went the advice. You’ll have no problems with the tax man. Well, as it turns out that is not quite as true because of United States v. Craft, 535 U.S. 274 (2002).

Don Craft didn’t file any income tax returns for the years 1979 through 1986. In 1988 the IRS assessed $482,486 in unpaid income taxes against Mr. Craft. When he failed to pay, pursuant to IRC Section 6321, the federal tax lien attached to “all property and rights to property, whether real or personal, belonging to him.” This lien attaches automatically and does not have to be ...

SOME SITUATIONS MAY REQUIRE A TAX LAWYER TO INTERPRET

1. There is accrued interest on the loan, especially on a home equity loan, that was not used to improve the residence (a cash-out).

2. There is a foreclosure sale of short sale with expenses incurred in connection with the transaction that may or may not be added to the loan balance or sales proceeds allocated to late fees or interest.

3. The home has been both a principal residence and vacation home.

4. One spouse has left the home.

5. A spouse is insolvent immediately after the forgiveness of non-qualifying debt.

6. There is home equity debt and total debt exceeds the fair market value of the home.

7. The home is sold at a gain following debt forgiveness.

8. The home is sold at a loss following debt forgiveness in the same year.

9. The lender participates in the sale of a home at a gain.

10. A single umbrella debt encumbers two residences in which the spouses reside separately.

11. The spouses are to file MFS returns following a forgiveness or fo...

MORTGAGE FORGIVENESS DEBT RELIEF ACT OF 2007 PRESENTS DIVORCE TAX ISSUES

Effects of the sub-prime mortgage debacle are certain to be felt in divorce proceedings. Moreover, relief granted by Congress to distressed homeowners will present additional tax issues of which divorce lawyers should be aware.

The Mortgage Forgiveness Debt Relief Act of 2007 (Act) provides tax relief to defaulting homeowners who might otherwise owe income tax on the forgiven portion of their mortgage obligation. A lender that is paid less than the full principal owed on the mortgage often decides not to personally pursue the borrower for the deficiency. In that case the lender files Form 1099-C informing IRS and the borrower of the forgiven portion of the debt that is to be treated as income.

The Act makes nontaxable debt forgiven on a qualified principal residence (QPR) with certain limitations as follows:

1. The relief applies to debt forgiven between January 1, 2007 and December 31, 2009.

2. Qualified principal residence is a residence as to each taxpayer meeting the s...