Articles Posted in CPAVille

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Ostanek v. Ostanek, Slip Opinion No. 2021-Ohio-2319

Issues with division of retirement accounts are seemingly springing up all over the place. At heart in most of these cases is a domestic relations order. Those are the orders of court that instruct an entity to, in short, divide the retirement funds. And since many people that have these retirement divisions are finally reaching retirement age, they are findings issues with the orders. Below is an example of an issue in the Ohio courts. Continue reading →

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Spouses who own businesses can often keep a tight lid on finances. This may not be an issue at the onset of marriage, but it means that often, the other spouse is clueless as to how the money is being made. In the unfortunate event of divorce, income becomes a bigger issue when litigating over support and property division. This post is to serve as a primer for two common business entities you may encounter in North Carolina: the C corporation (C corp) and the S corporation (S corp). Continue reading →

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The American Rescue Plan Act of 2021 (hereinafter “Plan”), also called the COVID-19 Stimulus Package, was passed by Congress and officially signed into law by President Joe Biden on March 11, 2021.  The Plan seeks to aid the economy in recovering from the effects of the COVID-19 pandemic. One significant change the Plan provides for is a new federal enhanced child tax credit beginning July 15, 2021. Statistics show that the credit will go to roughly 39 million households with about 65 million children. For the 2021 tax year, the enhanced maximum child tax credit is $3,600 for children younger than age six (6) and $3,000 for children between the ages of six (6) and seventeen (17).

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Abdeljabar v. Khalil, 812 S.E.2d 914(Table) (N.C. App. 2018)

Equitable Distribution (ED) is one of the mechanisms by which former spouses separate their personal and real property. What if the during the marriage one party opens a small business? Businesses are subject to ED, and valuation of a business can be very complex. But in the case below, we discuss why you should consult an expert in Equitable Distribution. Continue reading →

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Henry v. Comm’r, T.C. Memo. 201924, 2019 WL 1385242 (2019) 

 
(a) Facts: Husband and wife married in 1997 and divorced in 2013.  While the divorce case was pending, the parties filed a joint income tax return for tax year 2012.  The return did not report $14,650 in income earned by the husband from his second job as a church musician. 

 
The IRS assessed a deficiency, which neither party contested.  The IRS then seized funds from the wife’s 2014 tax return to satisfy the deficiency.  The wife moved for innocent spouse relief.  The IRS granted relief but denied the wife a refund.  The wife sought review in the Tax Court. 

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Schorse v. Comm’r, T.C. Memo. 2018176, 2018 WL 5270556 (2018)

(a) Facts: Husband was a computer programmer and wife was a physician. During the marriage, the wife earned 80% to 90% of the parties’ income.
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Welwood v. Comm’r, T.C. Memo. 2019113, 2019 WL 4187568 (2019)

(a) Facts: Husband and wife were married in 1973. They separated in Florida 2003 and signed an agreement dividing their property.

In the agreement, the husband conveyed to the wife a 50% interest in certain real estate partnerships. The partnerships were designed to generate tax savings in early years. A 1986 tax law change limiting the deduction of passive losses against other income made the partnerships much less attractive in their later years. Continue reading →

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HeydonGrauss v. Comm’r, T.C. Memo. 2018209, 2018 WL 6720943 (2018)

(a) Facts: Husband and wife filed joint tax returns for tax years 2005 to 2009. They separated on 2010 and were divorced in 2015.

The parties did not enclose full payment with their 2005-2009 tax returns until 2010. The wife was not aware of this fact until 2010. But she was aware that the parties were spending beyond their incomes and living beyond their means. The wife paid nothing on the parties’ tax liabilities, and the divorce decree ordered her to reimburse the husband for half of the payments he had made. Continue reading →

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Neitzer v. Comm’r, T.C. Memo. 2018156, 2018 WL 4519997 (2018)

(a) Facts: Husband owned and operated two businesses. The wife, who was trained as a nurse, was totally disabled after a series of spine and hip surgeries. Her income came primarily from disability benefits.

The couple separated in 2010. Their 2012 joint tax return was prepared by the husband’s business accountant. The wife was notified of the return only two hours before she was expected to sign it. The accountant had been told to disclose nothing to the wife about the husband’s personal or business finances. The wife signed the return without reading it. Continue reading →