Take the Simple, Inexpensive Steps Necessary Now to Make Sure Your Loved Ones Can Manage Your Financial Affairs for You and Make Health Care Decisions for You In The Event You Suddenly, Unexpectedly Become Unable to Do So For Yourself – Or Your Minor Children – Rather Than Risk Potentially Complex, Slow and Expensive Guardianship and Related Legal Proceedings to Accomplish the Same Thing at a More Difficult Time

Recently, an acquaintance was telling me how her mother, a very intelligent professional woman about eighty years old, deteriorated from highly functional semi-retirement from her profession, to requiring hospitalization, rapidly followed by institutionalization.

All in the course of about six weeks. Six weeks.

She had lost all capacity to remember anything, in the virtual blink of an eye. Severe dementia. She could not even remember to eat or drink enough to sustain herself.

This woman and her husband had run several successful businesses and had amassed significant wealth.

Leaving her family not only reeling in shock, but also scrambling to try to sort out her affairs.

Hot on the heels of hearing about this, a prospective client consulted me in regard to her elderly parents.

For some years, they had wanted to create powers of attorney, both for help in managing their financial affairs and for health care decisionmaking purposes if they became unable to do so for themselves. They had also wanted to re-title some of their properties, to avoid delays in transfer in probate(s).

But, somehow, they just never quite got around to taking care of these things. They could always do it tomorrow …

Now, the father has Alzheimer’s and the mother has difficulty getting around.

In both families, the impaired family members now require caregivers.

These impaired family members cannot manage their own affairs. They can no longer execute legal documents, be it a will, a trust, a deed or a power of attorney.

Sooner or later (probably sooner), it will very likely be necessary for their spouse or a child to file for guardianship of them. So that a loved one will have the legal authority to make decisions and pay for their care as they would want, and to ensure that their affairs are handled as they would want.

Unfortunately, guardianship is a potentially complex, slow and expensive court proceeding.

The sad thing is that in both families, all of the family members’ objectives could have been accomplished without the need for a guardianship proceeding … if these parents had just taken a little bit of time and spent a little bit of money to execute a few important but relatively simply legal documents … before the parent deteriorated mentally.

All of the parents could have had peace of mind, and their children could have had peace of mind. Their spouse or children could have been authorized in advance to smoothly step in to do whatever needed to be done or decided – and they would have had access to the resources necessary to implement these things.

Without the delay, expense and added stress of having to scramble to consult and retain lawyers to file guardianship under such difficult circumstances.

Age, disease, even injury can all cause severe infirmities that can interfere with a person’s ability to manage their own affairs and provide for one’s own care. In some cases, the infirmity can strike in an instant. At any age.

If the impaired person has minor children, the stakes are even higher.

Who will care for their children? Who will be able to manage any property intended for them.

This is every bit as important as having life insurance or a will. Some would say more important.

As in the case of the two families discussed above, people just like you and your family, nothing good will come of procrastinating. Don’t get stuck as they did.

Contact your family law attorney or estate planning attorney immediately … and give yourself and your family the priceless gift of peace of mind.

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Husband Files for Divorce; Wife Allegedly Hacks Off His Private Part

California Husband and Wife’s short marriage breaks down.

Husband files for divorce.

Wife does not take this well.

Wife cooks Husband’s dinner and reportedly drugs it.

Husband passes out.

Wife reportedly lashes Husband to his bed.

And when Husband comes to …

Wife allegedly wields a large knife …

To hack off Husband’s sexual organ …

And then shreds it in the garbage disposal.

Wife reportedly informs police that Husband “deserved it”.

Wife is arrested on charges of

felony torture aggravated mayhem

Wife is held pending posting of a $1 million bail.

If convicted, Wife could face life in prison.

Read more in this [LA] KTLA 5 TV news article: Bail Set at $1 Million for Woman Accused of Cutting Off Husband’s Penis.

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Taking Care of Your 401(K) or Pension Plan After Divorce … And Before Remarriage

The divorce is finally final.

So, what’s next?

A divorce party? A trip?

Well, you may want to let loose, but you still have some unfinished business to tend to.

Financial housekeeping.

Such as changing your designations of beneficiary on your various payable on death assets and accounts, including 401(k)s and pension plans.

Even if you’ve already updated your will to eliminate your spouse as a beneficiary.

This type of account or asset, called nonprobate, does not pass under your will.

In most cases, your designated beneficiary inherits them.

Even if you have divorced since designating your now ex as your beneficiary.

Having said that, it’s also important to be aware that federal law, specifically ERISA, supersedes any attempts to disinherit a spouse of a qualified pension plan or 401(k).

That includes a second or third spouse.

So, if your intention is that someone other than, say, your second spouse inherit your pension / 401(k) (such as your childen), your new spouse must execute a spousal waiver and consent. Period.

A spouse can contractually commit to execute a waiver in a divorce settlement agreement and in a prenuptial agreement.

If that is too much of a hassle or doesn’t “feel good”, you can roll your retirement funds into an IRA, which is not regulated by federal ERISA law. Then all you have to do is change your beneficiary designation.

Read more in this Forbes piece: Don’t Let Your Ex-Husband Inherit Your 401(k). Or your Ex-Wife.

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Canadian Bankruptcy Law Allows Husband to Discharge and Avoid His Property Division Divorce Obligation

Canadian Husband and Wife are in the middle of a divorce, their second from each other.

Couple’s assets are appraised.

A division of assets is determined.

To equalize the property division, Husband must pay Wife about $41,000.

Husband files for bankruptcy.

And as part of Husband’s bankruptcy case, Husband lists and ultimately discharges through the bankruptcy the $41,000 debt Husband owes to creditor-Wife.

There is something of an outcry in Canada over Husband’s ability to avoid his marital divorce obligations thanks to Canada’s bankruptcy laws.

Canadian Supreme Court highlights the problem as requiring legislation to “close the loophole”.

US bankruptcy laws differ from Canada’s laws.

Read more in this [Edmonton] Canadian TV article: SCC: Under bankruptcy law, divorcee cleared of payments.

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Mother Has Not Seen or Spoken to Her American Born Son Allegedly Abducted to Egypt by His Father Three Years Ago When Son was Three

Husband and Wife have Son while living together in Indiana.

Husband is from Egypt.

Husband and Wife’s marriage is rocky.

While Wife is in the hospital, Husband allegedly abducts then three year old Son to his native Egypt.

Indiana family court awards Wife sole custody of Son.

Three years ago.

But Husband has not allowed Wife to see or speak to Son since.

Son has also had no contact with his big sister, from whom he was inseparable until the day he was abducted.

Husband was always insistent that Son be raised in the Muslim faith.

Wife never gave permission for Son to obtain a passport or to travel abroad.

However Husband was able to obtain an emergency passport for Son without Wife’s permission. It is unclear but the passport may have been issued by Egypt rather than the US.

The US government requires both parents’ consent to issue a passport for a minor child under sixteen years of age.

As an extra measure of protection, it is possible for either parent to place an alert so that the US government does not issue a passport for their child.

But parents should know that several foreign countries grant dual citizenship to American children of their nationals and may issue passports by their own country with only the permission of the parent who is a national of that country.

Egypt is not a party to the Hague Convention on the Civil Aspects of International Child Abduction. Wife’s US child custody order is not recognized in Egypt.

Seventy-four percent of the abducted children returned to the US in 2009 were abducted to Hague Convention countries.

Mother, as an American, non-Muslim woman, reportedly would not prevail in any child custody battle in Egypt’s own family courts.

Read more in this Evansville [IN] Courier Press article: Evansville’s Missing People: Life without Adam.

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Mother Murders Baby … and Then Takes Body Shopping and Visiting Friends For Hours

Twenty year old Mother has three month old Baby.

Mother is drinking at the home of a friend.

Baby is crying and Mother can’t get him to stop.

So Mother allegedly smothers Baby.

The next morning Mother reportedly puts Baby’s body into a baby carrier … and goes shopping with it.

Then Mother takes it to a neighbor’s house, where she socializes.

It is fourteen hours later before Baby gets to a hospital, due to the neighbor’s report to the police.

Mother is arrested on a charge of first degree murder.

Read more in this New York Daily News article: Mom killed baby in a drunken rage, then strapped him in a BabyBjorn and went shopping: prosecutors

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Very First Felony Prosecution Under Deadbeat Parent Statute is Against a Mother

Louisiana enacts a statute making it illegal not to pay court-ordered child support.

The severity of charges and punishment for breaking the law vary depending on the amount owed and the duration of the arrearage.

Punishment may include a fine and / or imprisonment.

Recently, a Louisiana municipality issued its very first felony warrant for violation of the statute.

And the alleged perpetrator is a deadbeat Mother, now living in Virginia, who reportedly owes over $18,000 in child support.

It is anticipated that Mother will be extradited to Louisiana.

A parent convicted of a misdemeanor violation of the statute who fails to keep up with their payments and discharge their arrearages may be arrested and prosecuted again.

Apparently the statute is exerting a positive impact on support compliance.

Read more in this [Monroe, LA] News Star article: Mom owes $18k, faces extradition.

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Valuation of Separate NonMarital Property – Sort Of – for Purposes of Property Division or Equitable Distribution in Divorce

In some divorces, equitable distribution or asset division is more complicated than in others.

For example, the nature and source of ownership of any particular item of property can create various variables that may muddy the straightforward fair market valuation always desired.

Small businesses are almost always complex to value, particularly closely held service businesses.

Another aspect of property that adds considerable complexity to valuation is where the property is premarital property of one of the spouses.

Despite property being premarital and seemingly separate, there may be factors that, depending upon your point of view, re-cast or taint part or all of that property as marital.

One of those factors is appreciation during the marriage of what came into the marriage as separate property. But not any and all appreciation.

Appreciate can categorized as one of two types: active or passive.

In Florida, among some other states, active appreciation during the marriage, or appreciation as a consequence of the efforts of a spouse, is considered marital property.

But passive appreciation during the marriage of what came into the marriage as separate property, or appreciation deriving from larger or outside market influences during the marriage, is nonmarital property.

If this isn’t enough complexity, a single item of property may potentially undergo both passive and active appreciation. On top of that, some active appreciation may be attributable to the efforts of actors other than the spouse, rendering such appreciation equivalent to passive appreciation.

Depending upon all the particulars for a particular item of property, tracing valuation components and then assessing a valuation of certain assets for purposes of asset division in divorce can be somewhat elusive.

Read more in this forensic CPA’s article: Divorce Valuation: Active vs. Passive Appreciation.

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Tax Consequence of Totally Voluntary Alimony Payments

An intriguing question that doesn’t come up too often.

Husband and Wife divorce.

Husband agrees to pay Wife alimony as part of their divorce settlement.

Such alimony is deductible by Husband on his income taxes and includible by Wife on her income taxes.

Now, after the divorce is finalized, Husband and Wife agree that Husband will pay Wife some additional spousal support. It isn’t entirely clear whether this would happen just once, or each and every month.

Does this additional support receive the same tax treatment?

Based on these facts, no.

For spousal support to be deductible by the paying spouse and includible by the receiving spouse, that spousal support must be mandated by a settlement agreement and/or court order.

Of course, if Husband is willing to commit to paying the additional support over time, Husband and Wife can formally modify their divorce settlement.

If they did so, then the additional spousal support should be deductible by the paying spouse and includible by the receiving spouse.

Failing that, the additional alimony is deemed to be a gift for tax purposes.

Please note that any U.S. federal tax advice contained here is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter that is contained in this blog.

Read more in this Wall Street Journal piece: Ask the taxgirl: Voluntary Spousal Support

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Israeli Wife Obtains Secular Divorce – and New Jersey Rabbi Allegedly Has Husband Roughed Up to Grant a Religious Divorce

Israeli Husband and Wife have secular divorce.

Wife seeks a Jewish divorce, called a get.

Husband refuses, in effect shackling Wife to him and blocking any remarriage in her faith.

Husband heads to Brooklyn.

And a New Jersey Rabbi, looking out for Wife, allegedly arranges for Husband to be kidnapped and roughed up in an effort to secure Wife’s get.

Husband grants Wife the get.

The Rabbi allegedly is no longer satisfied with just that, and tries to extort $100,000 for Wife from Husband’s father.

Now Rabbi and his wife face a federal prosecution on charges of kidnapping and coercion, which could culminate in life imprisonment if they are convicted.

Read more in this New York Post article: Silly rabbi! Bust for divorce force.

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