What Does Not Qualify As Alimony Payments For Tax Deductibility

Today, we’re talking about alimony and spousal support in California. And specifically this video is about what types of payments do not qualify as alimony.

Doing a series of videos where I found a publication put up by the Franchise Tax Board that’s talking about somebody’s specifics.

They’re interesting because they go the effective tax as opposed to you know what it is necessarily but how certain items of spousal support and alimony and what alimony is considered to be and what they’re not.

And this particular and types of alimony payments that do not qualify as alimony and the reason that’s important because alimony payments are tax deductible.

So if it’s established in a different way it wouldn’t be tax deductible. And I want to give you what the Franchise Tax Board is saying would not qualify as alimony therefore would not be tax deductible.

Property settlement payments even if required by the divorce to clear other instrument will agree.

So this is just a distribution of property. Let’s say you guys split up an assets sold the house and so forth that from written this that perhaps would not be considered alimony.

Of course, you don’t want to talk to tax advisors talk to an attorney about the specifics of this.

We’re not giving tax advice or legal advice. We’re just trying to get these informations out there more easily readable and findable way.

Retirement benefits that the other spouse’s entitled to received based on division of a community property.

Okay so what that I’m referring to is if let’s say the working spouse we have two spouses one that’s working, one is not working.

The one whose working let’s say they have created a $100,000 pension. The pension because it’s community property according to the Franchise Tax Board would be divided.

Let’s say they’re married 10 years. They’re in the pension system 10 years so it can be divided 50-50.

That’s $50,000 that, that spouse would receive as a distribution from this community property asset would not be considered alimony.

It will just be a division of a community asset. So that $50,000 wouldn’t be tax deductible and it wouldn’t be counted as alimony for the Franchise Tax Board.

Any voluntary payments made before they are required by Divorce Decree or written agreement.

I will read that again, any voluntary payments made before they are required by a Divorce Decree or written agreement.

So this is interesting. I made you a separate video all together on these.

So without a court order there is no order. Therefore you can’t get the benefit of the alimony.

So if you are going through divorce and you are you set let’s say you’ve separated and you’re living in a separate residence but you’re giving your spouse money on a monthly basis which a lot of people do.

And it’s recommended of course for variety of reasons but not the topic of this discussion.

Any money you’re giving your spouse, so, let’s say you’re separated, you’re giving your spouse a $1,000 a week or $4,000 a month you cannot get a credit for that.

So you can’t deduct that off your taxes at the end of the tax year because there’s no court order. You need to get what’s called a temporary order.

So you’ll have a court order so from this date forward you’re paying these much you can always amend that in the final judgment but you’re not going to get accredit for those nor you’ll be able to deduct that.

So the benefit or the idea would be to get a temporary order as soon as possible. So it is tax advantageous to you.

And I am going to do a separate video right after this one that talks specifically about that because it’s very important.

And then the last one they have here is child support payments. Child support payments are not alimony.

Obviously, they’re not spousal support. And they’re also not tax deductible nor does the other party receiving it have to claim it is as income.

Tim Blankenship with Divorce661.com, we specialize in California Divorce. I hope this information was helpful.

Please call us if you like us to help you with your divorce in California. We work out flat fee pricing.

I’d be happy to take care of that for you. The number is 661-281-0266.

Feel free to give me a call for a free consultation.

Chatsworth Pension Division QDRO Preparation Service Chatsworth CA

Today, we’re talking to the folks in Chatsworth, California about QDRO Prep Service.

QDRO stands for Qualified Domestic Relation Order otherwise know as a QDRO or QDRO.

This essentially is something you will need to prepare or have prepared if you’re going through a Divorce in Chatsworth and you need to divide your pension, 401K, 403 (b) and many other investment type investments.

If you contact your pension company or 401K 403 (b), etc and you’re going through a divorce, ask them if you need a QDRO or Qualified Domestic Relation Order to divide that specific investment.

If you do you’re going to need a service to provide that QDRO Prep Service. It’s something that runs along side your divorce.

It’s something you can do after your divorce but if you’re going to divide the pension it needs to be noted in your judgment.

And it has to be noted specifically in your judgment. And then you’re going to need a service like ours to prepare the QDRO.

Now the reason I did this video is we are one of the most affordable QDRO Prep Services.

Attorneys charge upwards of $2,000 for the same service we provide. We do the exact same service that the attorneys would do.

So if you’re looking to have a QDRO Prepared for your Divorce case in Chatsworth or anywhere in California, feel free to give us a call.

I’ll be happy to talk about the specifics of the QDRO Prep Process as far as preparing the jointers and serving the pension company, filing it with the court, drafting the QDRO language and then getting that pension divided for you.

My name is Tim Blankenship specializing in California Divorce or you can go to Divorce661.com for more information or feel free to give me a call at 661-281-0266.

Must Have Order To Deduct California Spousal Support Payments

Today, we’re talking about alimony and spousal support in California and specifically at the State of California Franchise Tax Board put out a publication talking about spousal support and alimony.

And we’re going over a lot of the questions getting this recorded on video so folks have a better understanding of how this works.

And we just shot a video and it was talking about what types of payments do not qualify as alimony.

I went through three or four things the Franchise Tax Board talked about here. And one of them was this that does not qualified as alimony.

Any voluntary payments made before they are written by a Divorce Decree or written agreement.

So right now we handle about 50 divorce cases a month. We do a high volume because we have affordable flat fees.

And we do really great services for folks taking care of the entire process for them from start to finish anywhere in California.

So we see a lot of scenarios of Divorce and what a lot of people do is they file for divorce.

They will move out or not maybe they’ll stay in the residence you know just for financial reasons but they are paying, they’ll do one of two things.

They either the one maintaining the status quo and continue to pay the bills and keep everything going as it was until they finally gets to the point where they divide up their property and come up with spousal support number if that’s the case.

Or let’s say one party moves out and let’s say the spouse that was working and let’s say the other spouse wasn’t they start giving a couple thousand dollars a month or whatever is appropriate in their case.

They start paying an amount to be considered as spousal support and child support.

Well, from what it says that would be considered as voluntary payment and it would not be qualified as alimony or spousal support in California.

And the reason that’s important to note is if you are paying money and there’s no court order and does not considered alimony it’s therefore not tax deductable.

And that’s one of the biggest things with alimony is you can deduct that from your taxes.

So if you paid $2,000 a month for alimony and you have a court order that says so then you can deduct those at the end of the year.

And your spouse receiving the spousal support would have to include that as income and they will be the ones paying the tax on that.

Now the way you can serve estimation this doesn’t, you’re not giving that tax advantage is as soon as you separate call us we can put together what’s called the Stipulation and Order.

So if you’re going to pay a thousand a month or whatever that number is, say, ‘Tim I’m paying a thousand a month.’

The divorce isn’t finalized which could take 6-8-12 months depending on how fast you move through the process.

You’re going to want to get some temporary orders immediately especially regarding alimony so you can get that tax advantage.

So you’re not just writing checks that you’re not going to be able to get any credit for. So this was right directly from the Franchise Tax Board.

We’re not tax advisers. We’re not giving tax advice or legal advice but I want to get this out there because this is how the franchise tax board and the tax treats alimony.

So get that court order as soon as possible so you could take advantage of it’ll be considered of those payments be considered as spousal support and alimony.

Tim Blankenship Divorce661.com, we can put an order together for you as soon as 24 hours.

We also can handle your entire divorce case anywhere in California.

Examples Of Alimony & Spousal Support California Divorce

Today, we’re answering the question what are examples of alimony payments and this is coming directly from the franchise tax board.

I found interesting publication they put out where they answered maybe 12 questions.

It was hard for me to find so I want to get this out on video because it gives and it talks about alimony and spousal support in California from a tax prospective.

So in this particular case they want to describe what other example of alimony payments might be because a typical alimony or spousal support payment is one party paying money, so cash, writing a check, transferring money from one party to the other.

In this they’re saying you don’t necessary have to have a cash transferred. There don’t have to be cash going from one party you know one spouse to the next.

That there can be in this could be payments made to a third party can be considered alimony.

Indirect alimony may include cash payments through a third party to satisfy the obligations of a former spouse such as to provide a residence for a former spouse.

For example rent, mortgage, utilities etc., medical costs payments or other such expenses incurred by the payors former spouse.

So those are ways that you can pay spousal support instead of just having a money payment for alimony or spousal support.

You could pay your spouse’s rent. You could pay your spouse mortgage or portion there of. You could pay the mortgage if and plus alimony or spousal support and that all can be considered spousal support.

And from reading the publication the reason you may want other payments being handled as spousal support has asked this publication from the franchise tax board indicates alimony is tax deductible for the payors spouse and it has to be taxable E-VAT.

So that’s to include in their taxes if you’re receivingspousal support. So the example in this case is if you are a spouse saying ‘Oh why I didn’t know I could pay the rent. Let me pay the rent.’

If you don’t write that up as a spousal support order then you cannot deduct the amount you’re paying for rent.

Let me just make sure that’s clear. If you decide in your divorce, you’re going to pay the mortgage let’s say of your spouse and its $2,000 a month and that’s your agreement.

You guys signed the judgment you’re done and you write a check and you pay the mortgage payment every month, that’s fine.

You know in fact it’ll probably you may even want to work out that you get the mortgage deduction, the interest deduction on that.

But let’s say you didn’t? If you pay $2,000 a month for the house its $24,000 a year you’re not going to be able to deduct that payment if it’s not included as spousal support or alimony.

So being at the franchise tax board says you can use or have this described as alimony if you write it up that way that $2000 you’re paying can be considered as spousal support or alimony which is the same thing.

And you can get that tax deduction when you go to file taxes. So you could find this information on the franchise tech support website.

It was difficult to find it. I definitely want to get this out in video and we’re going to do several more about spousal support and alimony and some of the tax implications going right off the franchise tax board publications.

Tim Blankenship specializing in California Divorce, I hope this was helpful.

Feel free to call me for a free consultation. We handle divorce cases all throughout California 661-281-0266.

 

What Is Alimony | What Is Spousal Support | California Divorce

Today, we’re talking about alimony otherwise known as spousal support more commonly known as spousal support in California.

And I’m taking this information directly from the franchise tax board as well because I want to give folks some information about spousal support.

A little bit of how it works including what the franchise tax board says about how they treat spousal support.

So this video essentially what is alimony and this is what the term has been known as within the courts and those of us in the business.

It’s more frequently referred to as spousal support.

So spousal support where alimony essentially is one spouse paying to another alimony or set amount of money on a monthly basis or by monthly basis or however you want to set that up where maybe the higher wage earner during the marriage is assisting the other party with living expenses and so forth because of a difference in incomes of the parties.

So this could be where one party earns a substantial more income than the other party.

Let us help offset and make it more fair because he had let’s say a non working spouse and then the bread winner through the marriage is they both had realized the benefits of that income.

If they were to divorce and go their separate ways and there’ll be no spousal support obviously the spouse who was not working would have no income whatsoever.

And perhaps they raised the children and so forth and so they shouldn’t be essentially set off with no income just because they didn’t work.

And the courts we’re not lawyers here, we’re not here to give legal advice. Keep that in mind.

But just from what we see keep in mind that the person shouldn’t be punished because they didn’t work and now they have no money.

So this is to help alimony payments to help with that person getting on their feet. Give them time to maybe get educated, go back to school or go back to work and then slowly get on their feet.

And there’s a lot that goes in this spousal support and alimony and how these amounts are determined.  I don’t want to get too deep in to that.

This was just to kind of give you a brief overview of what spousal support or alimony is.

So you know moving forward as far as your right is concerned that’s a whole different story whether you can get it or not but this video is just to discuss what alimony is.

It’s quite simple. It’s just one party paying to the other spouse an amount of money for a specific duration of time for a specific amount.

Tim Blankenship, Divorce661.com specializing in affordable California Divorce.

Which Los Angeles Divorce Court Do I File In?

Today, I want to talk to you about how the courts jurisdiction works for Los Angeles County specifically in how they divide up their branch courts and how you can figure out what court you need to file in.

So the main brain branch of the Los Angeles Superior Court is at Central. So it’s the Central Division in downtown LA.

That’s the main courthouse for the county of Los Angeles. So regardless of where you live in LA County as far as North in Palmdale and Lancaster as far as South at Long Beach as far as East is let’s say Pomona and as far West as LA County goes so West Hills, West Valley area all of you can find out in the Central Courthouse.

That is the main court. Now what the courts have done for convenience over the years as they have branch courts.

So there are courts in San Fernando branch court in Burbank, in Van Nuys etc. Long Beach.

These are branch courts that are there just for each of you. So you don’t have to drive as far to file your divorce case.

So I want to explain how jurisdiction works. So essentially if you’re living close to that courthouse most likely that’s going to be your court.

But we have is client call us saying they wanted to file, they basically send over the paperwork and said we live in X City, but we want to file in the Burbank because one of the spouses work in Burbank.

So it would have been convenient for them to go to the Burbank Courthouse.

The thing here is though have they attempted this on their own which they didn’t they hired us to assist them with their divorce but had they gone to the courthouse they want to go to.

In this case they want to go to Burbank to file their case but they didn’t live within the jurisdiction.

They would simply reject their petition for divorce and then send them to the correct courthouse to file which in this case if you live in Burbank you don’t have to go to Pasadena so you could have filed in Pasadena or in Central.

Part of the easiest way to figure out which court to file is you just give us a call. We can check and see based on your zip code where you should file your case locally.

So go ahead and give us a call for free phone consultation, I’ll be happy to prepare your Divorce case for you 661-281-0266.

 

Burbank Divorce Cases Must Be Filed In Pasadena

Today, we’re talking to the folks in Burbank, California.

So you folks in Burbank that used to file your divorce cases in Burbank, if you don’t know the Burbank Court has shifted their cases their divorce cases, there’s still a court there but they have transferred all their divorce cases to Pasadena.

Now that obviously makes it very inconvenient for folks living in Burbank to file for divorce that have to travel to Pasadena to file their Divorce case, to pick up paperwork, to go to the clerk’s office and finish your case.

So for the folks in Burbank I want to let you know we are a Full Service Divorce Paralegal Firm. We do serve the Burbank area.

We can facilitate your divorce process for you especially since there’s no court serving you for divorce now.

What entails is that we will fill out all the forms for you. We will go to Pasadena and file your case in Pasadena for you.

So you won’t have to travel at Burbank to do so. We’ll take care of preparing all the documents and filing them, serving them.

We’ll take care of all the financial disclosures.

So all the process and procedure of the divorce case we will take care of from start to finish including putting together your judgment which includes assets and debts as far as who’s going to get what property, the children, custody and visitation, spousal support the whole shot we’ll take care of.

If it’s an amicable case you won’t step foot in the court. Not even once. You won’t even know what it looks like because we’ll be the ones going down there and taking care of your divorce for you.

So let us do the hard work for you and take care of the Divorce. You go on with your lives and your jobs and don’t that have affected.

Divorce is big enough changing your life. Let us help you through the confusing and difficult process of divorce in Burbank and take care of it at the Pasadena Courthouse for you.

Feel free to give me a call for a free phone consultation at 661-281-0266.