A change in marital status means many changes to your tax situation. It’s important to inform the IRS of these changes and review the effects of your different options in order to get the most beneficial tax results.
If you have changed your legal address, the IRS has to be officially informed by filing Form 8822. If you change your name, you need to inform the Social Security Administration, using Form SS-5.
To avoid withholding too much or too little from your paychecks now that your family size and/or family income has changed, ask your HR department for a new W-4 form and make the necessary changes.
Filing Status
There are five tax-filing statuses: single, married filing jointly, married filing separately, head of household, and qualified widow(er) with dependent child. While the last option is not available to you, which of the other options you use depends on multiple variables.
The IRS considers your marital status as of midnight on December 31. If your divorce was finalized on December 30, you cannot file with either of the “married” options. If you don’t get divorced until January 1, you cannot file as “single,” even if you did not live together, because you were still married as of December 31.
If, however, you were separated for more than six months, you were paying the majority of household expenses, and you have at least one dependent, you can file as “head of household.”
Before determining your tax filing status, consider the tax effects of each of your options. While married filing jointly has a higher standard deduction, you are then both liable for whatever taxes are incurred. If your income is significantly lower than your spouse’s, you may be better off filing as married filing separately or as head of household, if that is an option. Remember, however, you cannot file as single if you are still legally married on December 31.
Claiming Dependents
If the divorce decree does not dictate who claims the children, the IRS rules that the parent with whom the children stay for the majority of the year (usually the custodial parent) can claim them as dependents. In the unlikely event that they stay with each parent the exact number of days in a year, the parent with the higher adjusted gross income can claim them.
The parent who claims the children is then eligible for other tax benefits: an increase in Earned Income Credit, possible Child Tax Credit, Child and Dependent Care Credit, and educational or medical deductions.
Alimony and Child Support
Child support is neither tax deductible by the payer nor needs to be reported by the receiver. The thought is that if the parents had not divorced, they would be paying for their children’s food, clothing, and housing, none of which is tax deductible, therefore child support is not tax deductible.
Alimony is handled differently, depending on whether your divorce took place before or after December 31, 2018.
For divorces prior to 12/31/18, the payer is able to deduct alimony from taxable income, and the receiver has to report the alimony as taxable income. For divorces after 12/31/18, the payer may not deduct alimony from taxable income, and the receiver does not report the alimony as taxable income.
This significant change is due to the Tax Cuts and Jobs Act, which went into effect for alimony as of January 1, 2019. Divorces prior to that date are grandfathered into the old tax law unless modifications are made to the divorce agreement.
Given the many changes that can take place in the first year or two after divorce, it’s best to work with a tax advisor who is familiar with the tax challenges associated with divorce. A good divorce lawyer should be able to recommend a tax professional who can help you.
Is There Permanent Alimony in PA?
AlimonyAlimony in Pennsylvania is usually awarded as rehabilitative or reimbursement alimony. As it sounds, reimbursement alimony helps to pay back a spouse for helping with some major expense of the ex-spouse, often education. Rehabilitative alimony is generally awarded for a fixed time period to give the receiving spouse time to receive training or otherwise become self-supporting.
However, there are times when the possibility of a spouse becoming self-supporting is unlikely. In these circumstances, a ruling of permanent alimony is possible.
The awarding of alimony depends on 17 factors defined by law. In summary, those factors include matters of standard of living during the marriage, income level or income potential of each spouse, and various available financial resources weighed against financial need. Also considered are marital misconduct, each spouse’s contribution to the care of minor children, the length of the marriage, and the health of each spouse.
The factors that weigh most heavily on the question of permanent alimony include:
The word “permanent” is somewhat misleading, because such alimony can in actuality be stopped if the payer or recipient dies or if the recipient either remarries or co-habits with a member of the opposite sex who is not a relative.
Permanent alimony can also be modified, if the circumstances of either spouse change substantially and are expected to be long-term.
When couples negotiate an agreement, they may be able to determine a fair alimony payment that takes into consideration their standard of living, budgeted expenses and income, and the financial opportunities of each spouse. Since the rules governing the awarding of alimony in Pennsylvania are not distinctly defined and there is no set calculation, the amount and duration of alimony awarded is entirely at the discretion of the judge, and therefore sometimes a surprise to both spouses.
An experienced divorce lawyer can help you negotiate an agreement that is fair to both parties, or when necessary, help you present your best possible position in court. Reach out to us here at Ulmer Law to discuss how we can help you.
Warning Signs of Parental Alienation
DivorceParental alienation is defined as the programming of a child by one parent, consciously or unconsciously, to damage or destroy the child’s relationship with the other parent. It is most commonly found in high-conflict divorces and often directed at the non-custodial parent, but this is certainly not always the case. Sometimes the custodial parent is the target, and sometimes it even happens in intact families.
The manipulating parent may have difficulty separating from the pain of the divorce and focusing on the needs of the child, or the parent may have a personality disorder like narcissism. We recently wrote a post about divorcing a narcissist that may be helpful in recognizing this personality.
Even good parents can carry a lot of anger and sometimes allow negative comments about the other parent to slip out, but most good parents recognize that children will grow best if they maintain healthy relationships with both parents. It generally takes a very bad situation or a parent with a personality disorder to trigger alienating efforts.
However, parental alienation in some form is common: a 2010 study found it present in 11-15% of divorce cases. Here are some warning signs for a targeted parent to watch for:
Parental alienation is growing in recognition, and efforts are being made to address it in court. Some argue that it is a form of child abuse, as the child is being emotionally manipulated and fed false beliefs. Various psychological consequences are being recognized in children who have been victims of manipulation, so it’s important to address this issue early.
If you think you may be dealing with a situation of alienation, please reach out to us. We can help you evaluate the situation, document your evidence, and take important corrective steps.
When Will My Child Support Payments End in Pennsylvania?
Child SupportThe answer to this question seems straightforward: According to PA law, child support ends when the child turns 18 or graduates from high school, whichever is later, unless the parents have agreed in writing to continued support or it has been ordered by the courts because of the special needs of the child.
The law is explicit, but there are a few caveats. Although efforts are made in the law to create a system of oversight, you can’t depend on the overburdened court system to know when your child’s support should end and terminate the order automatically. Additionally, you do have options to modify child support, whether you are the custodial parent or the parent paying the support.
The Domestic Relations Section office (DRS) of the state in which the child support order was given is expected to send an inquiry to the custodial parent within 6 months prior to the child’s 18th birthday, confirming the birthday, graduation date, and any written agreements for the continuation of support. If the custodial parent does not respond within 30 days or confirms the dates and there are no legal agreements for continuation, the charging order may be modified or terminated in court automatically – but don’t count on it. If you are the paying parent and you want to terminate payments, you should take the matter into your own hands.
In order to request a modification or termination order, a few months before your child graduates or turns 18, file a Petition for Modification of an Existing Support Order with the DRS in the county listed at the top of your child support order. The custodial parent will be notified and will have the opportunity to appear to contest the petition. If you are the paying parent, whatever you do, don’t stop paying before the court order is changed. The courts will enforce any agreement you have with the other parent, taking it out of your wages and possibly adding a penalty on top of that. And if you have other children you are continuing to support after one child reaches emancipation age, the change in payments may not be significant.
There are a number of circumstances that can justify the modification or termination of child support, and either parent can petition for modification:
Reach out to us if you have any questions about whether your situation would justify a modification or termination of child support.
The 4 Keys to Repairing Credit after Divorce
Debt, DivorceIf your credit has been damaged during your marriage, expect to take some time to repair it. The first step, of course, is to obtain a credit report. You can receive one free report each year from a free report agency, or check with your bank. Assess your situation and then make a plan of action. There are four key steps to repairing your credit: close current joint accounts, restructure your debt, develop a budget, and take positive steps to repair the damage.
Close
The first step is to close all joint accounts. Officially call the companies or banks and close the accounts. Some institutions may require your spouse to also call or sign. Make sure you document your efforts, and if your spouse delays, document that, too. Keep copies of statements in case your spouse decides to go on a wild shopping spree before closing the joint account. In settlement, the judge may award a larger portion of the debt to the spouse if there is clear evidence of an attempt to burden you with more debt. Obviously, keep official proof that the account has been closed. If your spouse is handling this aspect, make sure you have copies as well.
Restructure
The joint debt remains the responsibility of both of you until it is paid off. Restructuring the debt by transferring a portion of the balance to an account in just your name or refinancing in some other way will separate the expenses – assuming your ex does this as well. If a portion of the debt remains in both your names, you will remain jointly responsible for it, at least until a clear judgment is made by the courts. So try, as much as possible, to get an agreement from your spouse to split the bills.
If you’re selling a house, you could use a portion of the sale to pay off any joint debt before distribution of the balance. This will leave a smaller payoff, of course, but will give you both a clean slate with which to start your new lives apart.
If the above options are not possible, try to split the responsibilities evenly, and get it in writing. For instance, if you offer to pay loan A and he or she is to pay loan B, get it in writing. If your ex doesn’t pay and the bill collectors come after you, you will have proof of divided responsibility and will be able to go to court for payment enforcement.
Budget
Now that you know how much you have to pay, take a close look at your income and expenses, including repaying debt. Create a budget and stick to it. If you don’t have much experience with budgeting, or if it looks like you don’t have enough income to cover your necessities, find a trustworthy credit counselor who can help you make good financial changes.
Repair
It’s time to open some accounts in your own name. If you changed your name when you married and you want to change it back, do so before opening the new accounts. If your credit is bad, you may need to open a secured card. With a secured card, you put forward a certain amount of money and then you are able to borrow against that money and pay it back at the end of each month. By paying bills on time over a period of months and by not taking out new loans for a while, your credit score will begin to improve. As it improves, you will be able to get a normal credit card, close the secured card, and get your down payment back.
When going through a divorce, it’s important to have a team to help you. Besides having moral support, choose trusted advisors for credit, tax, and legal advice. With financial and legal guidance and emotional support, you can get through this and be stronger on the other side.
Divorce and Your Taxes
DivorceA change in marital status means many changes to your tax situation. It’s important to inform the IRS of these changes and review the effects of your different options in order to get the most beneficial tax results.
If you have changed your legal address, the IRS has to be officially informed by filing Form 8822. If you change your name, you need to inform the Social Security Administration, using Form SS-5.
To avoid withholding too much or too little from your paychecks now that your family size and/or family income has changed, ask your HR department for a new W-4 form and make the necessary changes.
Filing Status
There are five tax-filing statuses: single, married filing jointly, married filing separately, head of household, and qualified widow(er) with dependent child. While the last option is not available to you, which of the other options you use depends on multiple variables.
The IRS considers your marital status as of midnight on December 31. If your divorce was finalized on December 30, you cannot file with either of the “married” options. If you don’t get divorced until January 1, you cannot file as “single,” even if you did not live together, because you were still married as of December 31.
If, however, you were separated for more than six months, you were paying the majority of household expenses, and you have at least one dependent, you can file as “head of household.”
Before determining your tax filing status, consider the tax effects of each of your options. While married filing jointly has a higher standard deduction, you are then both liable for whatever taxes are incurred. If your income is significantly lower than your spouse’s, you may be better off filing as married filing separately or as head of household, if that is an option. Remember, however, you cannot file as single if you are still legally married on December 31.
Claiming Dependents
If the divorce decree does not dictate who claims the children, the IRS rules that the parent with whom the children stay for the majority of the year (usually the custodial parent) can claim them as dependents. In the unlikely event that they stay with each parent the exact number of days in a year, the parent with the higher adjusted gross income can claim them.
The parent who claims the children is then eligible for other tax benefits: an increase in Earned Income Credit, possible Child Tax Credit, Child and Dependent Care Credit, and educational or medical deductions.
Alimony and Child Support
Child support is neither tax deductible by the payer nor needs to be reported by the receiver. The thought is that if the parents had not divorced, they would be paying for their children’s food, clothing, and housing, none of which is tax deductible, therefore child support is not tax deductible.
Alimony is handled differently, depending on whether your divorce took place before or after December 31, 2018.
For divorces prior to 12/31/18, the payer is able to deduct alimony from taxable income, and the receiver has to report the alimony as taxable income. For divorces after 12/31/18, the payer may not deduct alimony from taxable income, and the receiver does not report the alimony as taxable income.
This significant change is due to the Tax Cuts and Jobs Act, which went into effect for alimony as of January 1, 2019. Divorces prior to that date are grandfathered into the old tax law unless modifications are made to the divorce agreement.
Given the many changes that can take place in the first year or two after divorce, it’s best to work with a tax advisor who is familiar with the tax challenges associated with divorce. A good divorce lawyer should be able to recommend a tax professional who can help you.
Modifying Your Divorce Agreement
DivorceWhile an appeal to a divorce decree must be completed within 30 days, a modification to a divorce agreement can be requested at any time after the divorce. It is not uncommon that, after significant time has passed, circumstances have changed enough to warrant an alteration of the divorce agreement.
If both spouses agree to the changes, the process is fairly simple. The agreement must be in writing and submitted to the court in which the divorce decree was issued. Sometimes there is a hearing to ensure that both parties truly agree, then the judge signs off on the agreement and it becomes a court order. Working together with your lawyer to ensure the divorce agreement is written properly is the easiest and best way to make changes to a divorce agreement.
However, sometimes former spouses cannot agree. In this case, the person who wants the modification must file a motion for modification with the court that issued the divorce and serve it on the other spouse. Getting a modification from a court is not easy because you will have to present proof of significant, long-term, or permanent changes that justify the modification.
Courts rarely modify property or debt distributions in the original divorce agreement, but changes to spousal and child support and changes to custody and visitation are not uncommon. Where children are involved, the person seeking modification must prove that the change is in the best interest of the child.
Reasons for modification of support
A significant change in income is often grounds for modification, whether you are the payer or the receiver. If the payer gets a significantly higher paying position, the receiver may request more spousal or child support. Additionally, if the receiver loses a job, more support could be requested.
Conversely, if the payer loses a job or gets a significantly lower-paying job, the payer can request a decrease in the amount of support paid. This is also true if the payer has more children with a new spouse, demonstrating a need to support other children. One caveat: A parent cannot purposely take a lower-paying job in order to request a change in support. This may be difficult to prove, but if suspected, it could be considered contempt of court.
In the case of child support, the receiver may demonstrate a significant change in the child’s health or condition to warrant an increase in support or the payer may demonstrate that the child now needs less support. In these cases, courts will keep in mind the best interests of the child.
Reasons for modification of custody or visitation
A change in the condition of parents or children can justify a request for modification.
If one parent was ill-fit for joint or sole custody at the time of the divorce and can now prove he or she is fit, a case for modification may be made. However, a formerly unfit parent cannot demand sole custody if the parent who currently has sole custody is still a fit parent.
If a parent who has sole or joint custody becomes unfit, or if any child abuse or substance abuse can be demonstrated, custody provisions can be modified, keeping in mind the best interests of the child.
If your child is spending more time with you than is listed in the custody agreement, you may wish to modify the agreement so that you can legally protect this precious time together. The additional time also means an increase in child expenses on your part, suggesting a need to modify support as well.
Your next steps
In any of these situations, you will need to show significant evidence in order to convince the court to change the agreement. Laws that govern the standards to be met in each case vary from state to state, so be sure to talk to a lawyer who is expert in the divorce laws of the state in which your divorce was issued. We here at Ulmer are experts in Pennsylvania law. Reach out to us to see how we can help you.
Contested Adoptions
AdoptionIf the natural parent(s) do not agree with the adoption, there is a hearing to determine if their rights should be involuntarily terminated. In this situation, an attorney must be appointed to represent the interests of the adoptee(s). An attorney may also be appointed for the parent contesting the adoption. When presiding over a petition for involuntary termination, the court must first consider whether grounds for involuntary termination have been established. Grounds for termination include instances where a parent has failed to perform any parental duties for at least six months, where a parent has demonstrated incapacity, abuse or neglect, or the child has been removed from the care of the parent(s) by an agency and parents have not been able to successfully remedy the situation which led to removal.
Once grounds for termination are established, the court then turns to the needs and welfare of the child(ren) involved. A major factor is the emotional bond between the parent and child and potential consequence of severing that bond. A parent’s representation of love and affection for a child without further corroboration, are not sufficient to prevent termination of their rights based on the best interests of the child. The role of the attorney appointed for the adoptee(s) is to elicit and relay the position of the children involved. The attorney may also weigh in as to whether the adoption proceeding would be in the child’s best interests and whether the benefit of adoption outweighs any harm from the termination. Other parties, such as social workers involved in the case, can also offer an opinion as to the welfare of the children and any possibility of irreparable harm in severing the parent-child relationship. If a final decree of termination is entered by the court, the case may proceed with adoption.
Notice Requirements for Adoption
AdoptionIt is always necessary to give all interested parties proper notice of pending adoption proceedings. A copy of the adoption petition should be served on all interested parties, e.g. persons with parental rights to the minor child(ren) involved. Acceptable methods of service include personal service or certified mail, return receipt requested, restricted delivery. With personal service, an affidavit of service would then be filed with the court detailing date, time and place of service. With service via mail, verification of delivery would come back from the post office with the signature of the party served. Proof of service should be filed with the court and/or submitted at the time of the hearing.
A copy of the notice for hearing must also be served on all interested parties. At least ten days’ notice of any hearing must be served by personal service or registered mail to the parties’ last known address. If the rights of the natural parents have already been terminated, you are not required to give them notice of the subsequent adoption hearing date since they are no longer an interested party. If you do not have an address for an interested party, you can petition the court to allow service by an alternate method. This would usually entail publication in the newspaper in the county where the interested party was last known to reside.
Overcoming the Stress of Divorce
DivorceStress after divorce is to be expected. You’re embarking on a new stage of your life, but things will be different socially, emotionally, and financially. Looking at the big picture can cause anxiety, but by allowing yourself time to adjust and by taking things one at a time, you can manage the stress and anxiety and come out stronger on the other end.
It’s important, first of all, to allow yourself to feel many different emotions. Do not try to bottle them up. And give yourself time to perform at less than full capacity. You may be juggling new responsibilities, or the feelings themselves may be slowing you down. It’s okay. Don’t worry about what others may think of you, everyone has a different way of coping.
Don’t go through this alone, though. It’s important to have the strong social support of friends or family with whom you can share your feelings and who make you feel better. You may also need to reach out to a support group or professional counselor, especially one who is an expert in helping people adjust after divorce.
Keep yourself physically healthy. Exercise and a good diet improve your mental and emotional health. Get involved in activities you enjoy, indulge in hobbies to lift your spirits.
Positive self-talk is crucial. Don’t blame yourself for past mistakes, real or imagined. Focus on a better future. Understand that you can’t control everything, but you can control some things. Write down everything that worries you and brainstorm solutions. Friends may also have ideas. If there are some concrete things you can do to improve the situation, take one challenge at a time, and celebrate your progress.
Financial concerns can be a major stressor. If your spouse handled most of the finances, you’ll need to learn how to do so now. A financial professional can help you make a budget and suggest ways to improve your financial situation. If necessary, look into further professional training in order to get a job that will bring in more money.
If you have children, you’ll be understandably concerned about them. Give them extra attention and make sure they know they can rely on you. But they also need consistent routine and clear discipline, giving them structure and security during this insecure time.
After your divorce, things will be different, but they can still be good – maybe even better. By focusing on your emotional health, you will be able to cope better and also help your children cope. A good divorce lawyer should be able to refer you to appropriate support services. At Ulmer Law, we are committed to helping our clients not only get the best settlement but move beyond their divorce with the best possible future before them. Call us for a consultation.
Surrogacy Contracts
BlogSurrogacy is the process whereby a third party is used to assist couples in having a child. Surrogacy may be traditional wherein the third party will have a biological tie to the child but has agreed to relinquish any legal rights as a parent. The other option is gestational surrogacy where the third party is just a carrier and the egg and sperm of the intended parents are implanted in the surrogate. Pennsylvania does not have a statute in place as it relates to surrogacy, however, case law has established courts are willing to uphold the provisions of a surrogacy contract. In J.F. v. D.B., the carrier mother attempted to keep the children following birth despite having entered a surrogacy agreement. 897 A.2d 1261 (2006). The court eventually held she didn’t have standing for a custody action and turned the children over to the intended parents per the contract.
Another case which upheld a surrogacy agreement is In re Baby S, 2015 Pa. Super. 244 (2015).
In re Baby S, involved celebrity couple Sherri Shepherd and former husband, Lamar Sally. The couple had entered into a surrogacy contract to assist in having a child. Several months into the pregnancy, Shepherd refused to sign additional forms to have her listed on the birth certificate as the intended parent of the child because of the pending dissolution of her marriage to Sally. Sally ended up taking care of the child and subsequently sought support from Shepherd. The court ruled that Shepherd was an intended parent evidenced by the signed surrogacy contract and accordingly, ordered her to meet her child support obligation. Accordingly, parties who intend to use a surrogate should consult with an attorney first and draft a clear, unambiguous agreement.
You may also need a pre-birth Order to ensure the names of the intended parents can be listed on the birth certificate at the time of birth.