Double Dip Prohibited in Divorce: IRA Edition

by Brian Vertz on April 19, 2013

A recurring issue in divorce litigation is the treatment of marital assets that generate income, such as pensions, rental real estate and businesses. Pennsylvania case law establishes clearly that these assets can be divided as property in equitable distribution or counted as income for alimony, but not both. A recent decision published by Adams County […]

Health Insurance “Tail” Doesn’t Wag the Divorce “Dog”

March 18, 2013 Alimony

The recent non-precedential decision in Deslam v. Deslam, No. 1237 WDA 2012 (March 15, 2013) presented the Superior Court with the dilemma of Ellen Deslam in the nadir of her third marriage, just 36 months from her Medicare eligibility date, after a five year union. Apparently the divorce raised no serious dispute over the division […]

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IRS Disqualifies Tax Deduction for Alimony Paid Until Child Finishes College

December 2, 2012 Alimony

In Doolittle v. Commissioner, T.C. Summary Opinion 2012-103 (2012), a NON-precedential opinion of the U.S. Tax Court, the taxpayer settled his divorce by entering into a marital settlement agreement, in which he agreed to pay $900 per month alimony until December 31, 2010. The alimony was intended to “help with college costs,” according to the 2003 […]

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Prepayment of Alimony is not Tax Deductible

November 8, 2012 Alimony

Under federal tax laws, alimony payments are deductible, but only if they meet all of the legal requirements. One of the most important requirements is that alimony payments must be paid in connection with a “divorce or separation instrument,” which means a written agreement or court order. Any payment that is not made under a […]

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Double Dip and Goodwill Considered by Wisconsin Supreme Court

August 15, 2011 Alimony

Last month the Wisconsin Supreme Court weighed in on two issues that are important to family lawyers and their clients who operate professional practices like physicians, lawyers, dentists and accountants. In Marriage of McReath, the Wisconsin Supreme Court ruled that “saleable” goodwill would be considered marital property, in a case where a dentist argued that […]

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Homeschooling Children Does Not Justify Alimony, says Superior Court

March 19, 2011 Alimony

In Kent v. Kent (March 18, 2011), the Superior Court of Pennsylvania rejected a parent’s argument that she should be entitled to collect alimony for a period of eleven years so that she could continue to homeschool the parties’ minor children. It was undisputed in this case that the mother had withdrawn from the workforce […]

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What’s the Hullabaloo about Balicki?

December 12, 2010 Alimony

In Balicki v. Balicki, 2010 Pa.Super.134 (2010), the Superior Court affirmed the trial court’s decision to discount the value of an insurance business, based on the hypothetical income taxes that would be incurred by its owner upon sale of the business. The trial court’s decision was itself a reversal of the master’s report, in which […]

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10 Cash Flow Rules In Divorce (Part I)

September 28, 2010 Alimony

In business, they say, cash flow rules. The same principle is true, I find, in divorce. I have been brainstorming a set of cash flow “rules” for divorcing spouses. Here is part one: 1.  Never run out of cash. My #1 divorce rule is the as Inc Magazine‘s #1 business rule. In divorce, there is […]

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Alimony Tax Gross-Up Approved

August 9, 2010 Alimony

In Balicki v. Balicki, 2010 PA Super. 134 (July 30, 2010), the Superior Court considered the husband’s argument that the alimony order provided more income to his ex-wife than she could spend (as shown by her budgetary expenses). The trial court in its opinion justified the alimony award by noting that the wife would pay […]

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Pennsylvania: Alimony Factors

February 3, 2010 Alimony

The value of a spouse’s share of marital property and the income it generates, the income and earning capacity of each spouse, and the reasonable budgetary needs – these factors remain the most influential in Pennsylvania alimony cases.

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