Big Changes In Tax Law Bring Big Changes for Divorces

Posted by on January 16, 2018 in Alimony, Collaborative Law, Divorce, Family Law, Uncategorized

  The Tax Cuts and Jobs Act of 2017 (the new tax law) was signed into law by President Trump on December 22, 2017. Some of the changes from the law go into effect on January 1, 2018 and will affect the tax filings for the 2018 taxable year.  Notable changes that will affect divorcing spouses and parents are as follows: No more claiming your kids as tax deductions. Effective for the 2018 tax year, parents can no long claim their children as dependents for the purpose of deducting them on their taxes.  This change will certainly modify divorce orders and agreements as parents no longer will need to agree about who will claim the children on their taxes each year.  However, while Congress has taken away the ability for parents to claim your children on their taxes, it did double the child tax credit from $1000 per child to $2000 and allow parents to alternate this deduction for children each year.  All divorce agreements and orders after January 1, 2018 should contain language for how parents will claim the child tax credit.  Congress also allows all taxpayers earning up to $400,000 to claim the child tax credit, an increase from the prior cutoff income level of $110,000. Alimony payments are no longer deductible by the payor. Beginning with the 2019 tax year, for all divorce agreements signed after December 31, 2018 and later, those who pay alimony can no longer deduct alimony as an itemized deduction.  Those receiving alimony no longer have to claim alimony as income and will not be taxed on the payment of alimony to them.  This is a significant change.  According to the United States Census Bureau, 243,000 people received alimony in 2017.  This law change will speculatively could impact divorce negotiations with couples arguing about whether alimony should be paid when there is no longer a tax benefit to the payor.  It appears that the IRS will allow all ex-spouses who modify their alimony to follow the 2017 tax law in claiming alimony as a deduction for those that pay it and having those that receive alimony claim it as income so long as their agreements or orders specifically state that they wish to follow the old tax law and the decree or agreement was made before December 31, 2018. The new tax law eliminates many itemized deductions. Starting with the 2018 tax year, the new law maintains deductions for charitable contributions, retirement and student loan interest but eliminates other deductions.  The law limits how much a taxpayer can deduct from property taxes as well. However, Congress has doubled the standard deduction for individuals from $6,350 to $12,000 and for married couples from $12,700 to $24,000. Parents can use 529 education plans in creative ways. The new law allows parents to use up to $10,000 per year per child in funds in a...

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FREE CONSULTATION NIGHT

Posted by on August 3, 2016 in Collaborative Law, Family Law, S&S Firm News, Uncategorized

Shanelaris & Schirch is hosting a free consultation evening on Wednesday, August 31st from 5:00 to 8:00 p.m. Come in for a one-on-one free consultation with one of our highly skilled and experienced attorneys. Get immediate information and free legal advice. Consultations will be scheduled for 30 minutes between the hours of 5pm and 8pm. Call 594-8300 to reserve your time now to talk with the attorneys about your family law or divorce law concern. We look forward to the opportunity to...

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Parenting in the Holiday Season

Posted by on December 23, 2014 in Collaborative Law, Divorce, Family Law, Parenting Rights & Custody

As we approach the holidays, tensions can run high amongst family members; that may be especially true for divorced or separated parents.  As parents we want the holiday season to be filled with joy for our children as well as for ourselves.  We reflect back on our holidays during our own childhood and strive to replicate the joy or replace what may be our own difficult memories with beautiful memories for our own children.  For parents that are newly divorced or separated this time of year may be even more stressful as the pain of loss of the once intact family feels ever present.  One of the best gifts that divorced parents can give their children is a peaceful holiday season.  As difficult as it may be for you, the parent, it is more difficult for your children.  They feel the painful loss as well, and want nothing more than to be able to spend time with both parents as well as extended family and friends.  Those events and activities that make up our holiday traditions are important to them as well.  So, while it may be difficult it is likely best if you are able to negotiate the holiday schedule well in advance of the holiday itself.  Respect both families and extended families and their traditions, and above all, remember that your children are a piece of both parents and an appreciation and respect for all family members will show your children how to negotiate and resolve conflict in the most positive way. A Lesson from Dickens for Co-Parents this Holiday...

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