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Filing Taxes After Your Divorce

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Your tax filing situation changes no matter the length of your marriage once you've divorced. You need to choose a "single" or "head of household" depending on how you qualify. If you have children involved in your divorce, that also could factor into how to properly file your taxes. Both spouses are unable to file as "head of household" if child support or care is involved. Alimony may also be a factor that you have to consider when filing taxes as well. If you and your ex are in the middle of selling a home that you owned, this might have implications for your taxes as well as you could owe capital gains taxes.

Learn more about filing your taxes after going through a divorce here. LEARN MORE>>

New Jersey Divorce Law Overview:

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The following is a brief discussion of some of the main concepts of divorce law in the State of New Jersey. It is not ledivorce or legal problems concept. documents or papers filing, child custody, family law. man and woman sitting depressed at the attorney or lawyer officegal advice. It is highly recommended that one consult with a licensed New Jersey attorney when considering filing a divorce action or if you have been served with a Summons and Complaint.

 

New Jersey is a “no-fault” divorce state. That means that the court does not entertain allegations by the parties as to the specific issues that precipitated the divorce. For example, if one spouse is consistently spending time away from home and spending money that hurts the financial stability of the family as a whole, the court will not consider those allegations in granting the Complaint for divorce.  That is the court will not grant the divorce with a finding that one spouse was a good spouse and the other was the bad one. The court will not punish one spouse by awarding more of the marital assets to one spouse because the other spouse alleges character and moral flaws of the other spouse.

New Jersey is an “equitable distribution” state. That means that when the court considers how to divide the assets that accrued during the marriage between the parties, it will do so on the basis the assets are jointly owned and will be divided equally between the parties. For example, if one spouse worked for the 40-years and accumulated a valuable pension fund related to his or her employment during the 40-year marriage and the other spouse stayed at home caring for the children and otherwise maintaining the household, the value of the pension plan would be owned by both spouses equally.

 

The consideration of equal ownership of the assets that accrue during the marriage, the same is true for the liabilities that accrue during the marriage. For example, if during the marriage one spouse purchases a boat and takes out a $150,000 loan to buy it, and 4-years after the purchase the parties the parties file for divorce with $120,000 still owed on the boat, each of the parties are responsible for half of that remaining debt.

 

New Jersey courts determine child custody by applying a “best interests” of the children test. Both parents have an absolute equal right to the legal and physical custody of their children. However, when the court is considering child custody, it is the best interests of the children that is the paramount consideration of the court and not the wishes of either of the parties. For example, if one parent demands full legal and physical custody of the children because she is the mother or because he is the father, the court will not consider such ab assertion by either of parent as a legitimate basis of for awarding full legal and physical custody to parent of the other. In the alternative, if one parent can prove that the other parent is abusive and crates a home environment that is detrimental to the psychological wellbeing of the children, the court may consider it to be in the best interests of the children that they remain solely in the legal and physical custody of the parent that will provide the safest and most stable home environment.

 

The above examples represent a very small synopsis of the issues that parties considering divorce in New Jersey need to understand.  The Chiacchio Law Firm is highly experienced with the complexities of New Jersey family law. Should you have question about the issues discussed above or other issues related to divorce, please call The Chiacchio Law Firm for a free consultation.

New Jersey Child Support:

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Children of Divorce have an absolute right to be supported and their parents have an absolute obligation to provide for the financial support of their children.  The following outlines some of the rights and responsibilities of parents related to child support in New Jersey:

Parents’ Rights and Responsibilities Under New Jersey’s Child Support Program

 

A parent’s rights:

 

  • To be treated professionally with respect;

 

  • To be notified of any action that significantly impacts the child support case;

 

  • To pay and receive payment timely;

 

  • To get information through the website at www.njchildsupport.org, the toll-free New Jersey Child Support Customer Service Hotline, 1-877-NJKIDS1, or by using the NJ Child Support App, including the amount of support collected; the amount paid toward late payments; and the account balance;

 

  • To request a review of the child support obligation every three years;

 

  • To appeal a decision or request a review of a decision.

 

A parent’s responsibilities:

 

  • To notify the child support office of any changes that impact the case including custody;

 

  • To go to all scheduled court appearances that you are required to attend;

 

  • To cooperate in establishing paternity and a child support order;

 

  • To notify the Child Support Program of change of address or employer;

 

  • To fulfill child support financial obligations and provide health coverage as ordered by the court; and

 

  • To respond to the court’s requests for information.

 

This information and more information can be found at www.njchildsupport.org.

 

New Jersey calculates each parent’s child support obligation according to the Child Support Guidelines. The Child Support Guidelines are set out in New Jersey Rules of Court. The following is an excerpt from those Rules:

RULES GOVERNING THE COURTS OF THE STATE OF NEW JERSEY
PART V. RULES GOVERNING PRACTICE IN THE CHANCERY DIVISION, FAMILY PART CHAPTER II. SPECIFIC CIVIL ACTIONS

Rule 5:6A. Child Support Guidelines

The guidelines set forth in Appendix IX of these Rules shall be applied when an application to establish or modify child support is considered by the court. The guidelines may be modified or disregarded by the court only where good cause is shown. Good cause shall consist of a) the considerations set forth in Appendix IX-A, or the presence of other relevant factors which may make the guidelines inapplicable or subject to modification, and b) the fact that an injustice would result from the application of the guidelines. In all cases, the determination of good cause shall be within the sound discretion of the court.

A completed child support guidelines worksheet in the form prescribed in Appendix IX of these Rules shall be filed with any order or judgment that includes child support that is submitted for the approval of the court. If a proposed child support award differs from the award calculated under the child support guidelines, the worksheet shall state the reason for the deviation and the amount of the award calculated under the child support guidelines.

Note: Adopted May 9, 1986 to be effective immediately; amended November 7, 1988 to be effective January 2, 1989; amended May 13, 1997, to be effective December 1, 1997.

Considerations in the Use of Child Support Guideline (Court Rules Appendix IX-A) Use of the Child Support Guidelines (Court Rules Appendix IX-B)
Child Support Guidelines Sole Parenting Worksheet (Court Rules Appendix IX-C) Child Support Guidelines Shared Parenting Worksheet (Court Rules Appendix IX-D) Child Support Guidelines Net Childcare Cost Worksheet (Court Rules Appendix IX-E) Basic Child Support Award Schedule (Court Rules Appendix IX-F)

Combined Tax Withholding Tables for Use With the Child Support Guidelines (Court Rules Appendix IX-H)

One may review the Court Rules governing child support online at  https://www.njcourts.gov/attorneys/rules.html?section=Appendix. It is recommended that an attorney be consulted in order to best understand and appropriately apply the guidelines.

 

As the rule noted above states, there are circumstances where the court can either modify or disregard the guidelines. One of the more common reasons for disregarding the guidelines is when one or both parents’ income exceeds the income parameters delineated in the guidelines. For example, if one parent has net income of more than $180,000.00 year and the other parent is a stay-at-home parent, the income elements of the child support guidelines would not apply, and the court would exercise its discretion in determining a fair result.

 

The Chiacchio Law Firm will help you navigate through the details and application of the New Jersey Child Support Guidelines.  Call today for your free consultation.

Divorce and Spousal Intimidation:

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The marital relationship is in tatters. One spouse has decided that it is time to move on and pursue what he or she perceives as a better life ahead, while leaving the 20-year marriage in the rear-view mirror.

 

In this example, the other spouse wants to maintain the marital relationship for a host of reasons, including continuing unrequited love for the departing spouse, but most importantly to protect the children from the adverse effects that by the divorce will have on them. The other spouse sees the world only in the view of his or her happiness, which view no longer includes marriage and supporting, emotionally or economically, his or her children. Those obligations are in the mind of the departing spouse, an impediment of realizing his or her new vision of Shangri-La.

 

So, one fine day the unhappy spouse leaves the household, explaining to the other that he or she needs to find themselves. In the parting words are included, the following:

 

  1. Everything I earned is mine;
  2. If you come after me for alimony, I’ll take the children;
  3. I will buy the kids sneakers and stuff, but you will have them living with you and need to take care of the rest of their financial needs because I need my money for other things;
  4. If you interfere in anyway with my journey to true happiness, I will leave you penniless, and I will take the kids and move to another state;
  5. If you go to an attorney, I will rake you over the coals because I have the money and you will not be able to fight my economic superiority.

Fortunately, the law in New Jersey does not tolerate the kind of imbalance that the bullying spouse is exerting in the above example.

 

  1. New Jersey is an “equitable distribution” state. That means the assets/liabilities that accrue during the marriage will be distributed in a fair and equitable manner.
  2. Depending on factors that are well defined in the law, alimony is the right of a spouse in order for the parties to the marriage to live as close to the life style that was enjoyed by each of them over the course of the marriage,
  3. Legal and physical custody of children is determined by the court on the basis of what is in the “best interests of the child” and each parent has an equal right to parent his or her children. One cannot simply “take the children” and leave. Such behavior could lead to contempt of court and criminal prosecution.
  4. Where there as economic imbalance between divorcing spouses the law in New Jersey seeks to put each of the them on “a level playing field”, and legal fees may be ordered to be paid out of the marital assets.

 

The Chiacchio Law firm can help you navigate the uncertainty that is the specter of divorce. So, do not allow yourself and your children to be bullied and intimidated into accepting unfair terms.

Removal of Children from the State of New Jersey

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New Jersey has a statute that prohibits the permanent removal of children from New Jersey without the permission of the other parent or Order from the Court.  This law applies to children born in the state or who have lived here for five or more years.

In matters that are contested, the parent who seeks to remove the children must make an application to the Court before moving with the children and has the burden of showing good cause for the move.  In determining whether such cause exists, the Court must use the best interests analysis.  In doing so, the Court must consider all relevant factors, including but not limited to the following, supplemented by other factors where appropriate:

1)the parents' ability to agree, communicate and cooperate in matters relating to the child;

2)the parents' willingness to accept custody and any history of unwillingness to allow parenting time not based on substantiated abuse;

3) the interaction and relationship of the child with its parents and siblings;

4) the history of domestic violence, if any;

5) the safety of the child and the safety of either parent from physical abuse by the other parent;

6) the preference of the child when of sufficient age and capacity to reason so as to form an intelligent decision;

7) the needs of the child; the stability of the home environment offered;

8) the quality and continuity of the child's education;

9) the fitness of the parents;

10) the geographical proximity of the parents' homes;

11) the extent and quality of the time spent with the child prior to or subsequent to the separation;

12) the parents' employment responsibilities; and

13) the age and number of the children. 

 

If you or your spouse are considering moving with your children from the State of New Jersey, call my office to schedule a free consultation to learn more about your rights and responsibilities.

 

  1. Alimony and the New Tax Laws

 

Commencing January 1, 2019, alimony payments agreed to or ordered by the Court for the first time are no longer be tax deductible by the Payor and includable as income by the Payee.  So, unless you were divorced by December 31, 2018, you will loose this deduction.  The IRS has not yet provided any guidance on this issue, so it is unclear how, if at all, the new laws might affect existing alimony obligations that come back before the Court after January 1, 2019, for modification.

The difference between getting a divorce prior to 12/31/18 or not is significant, especially in higher income cases.  By way of example, a broker who is earning $1 million per year, might agree to pay his wife, a stay-at-home mother, $400,000.000 of alimony. Pre 12/31/18, he would be permitted to reduce his taxable income by the amount of alimony payments thereby reducing his tax liability.  Now, each party’s respective/potential tax liabilities have to be taken into account when negotiating the proper amount of alimony.  The Payor, who is in a higher tax bracket will now have to pay tax on the full amount while the Payee will receive the money tax free.

To learn more about how the changes to the tax laws might affect your rights and obligations, call today for your free consultation and/or discuss the issue with your tax professional.