Field of Study:
This course will teach participants how to apply, implement, and evaluate the strategic tax aspects of marital dissolutions and living
together arrangements. Current perspectives on property transfers, asset divisions, alimony, filing status, exemptions, and child
support are examined with an emphasis on planning considerations. Property settlements, basis allocation, third party transfers,
and purchases between spouses are explored and analyzed. Special attention is given to the division of business interests, retirement
plans (including QDROs), insurance policies, and the family residence.
After completing this course you will be able to:
- Specify multiple tax implications to consider when going through a divorce, and recognize the requirements and effects of filing as married or unmarried.
- Identify the requirements for filing a joint return and how to avoid being penalized.
- Determine the key elements of filing separate returns including what items to report and identify whether or not married taxpayers should file separate returns.
- Cite the requirements for filing as head of household and the tax ad-vantages and disadvantages of this filing status.
- Recognize the repeal of personal exemptions, their pre-2018 phaseout, availability, and reporting requirements.
- Identify the requirements for pre-2005 dependency particularly rela-tionship, married person, citizen or resident and income and, specify the former regular and special method for determining support recog-nizing complications from back child support.
- Determine the current “qualified child” standard using residency, relationship, age, and joint return prohibition, and identify require-ments that must be met for parents to treat a child as a qualifying child of a non-custodial parent.
- Identify deductible and nondeductible divorce expenditures specifying which spouse is subject to tax imposed upon withheld wages, and recognize the effects of making separate estimated tax payments or joint declarations of estimated tax.
- Determine community property and the community property states, and identify the effects of conversion and commingling of property and how to avoid such marital property issues.
- Identify community income earned by married couples for reporting purposes.
- Identify the effect of living together on filing statuses and dependency, determine differences between the married tax rate and other tax rates, recognize the tax consequences of having a living together con-tract to avoid tax traps, and specify the results of Marvin v. Marvin.
- Identify types of marital property and their likely division in marital property settlements and specify the legal principles used in dividing assets and providing support on divorce or separation.
- Determine the benefits of premarital agreements and the requirements and permissible provisions for a valid and comprehensive agreement under the Uniform Premarital Act.
- Specify the position of U.S. v. Davis on interspousal transfers and the changes made by §1041, and identify the requirements of §1041 and the scope of its application.
- Select factors that determine whether a property transfer is incident to divorce and identify how to meet these factors or avoid §1041 alto-gether when desired.
- Determine the application of §1041 to transfers in trust under §1041(e) and to third-party transfers on behalf of a spouse or former spouse.
- Recognize deferred tax liability by identifying property basis for the transferor spouse and transferee spouse under §1041 after a property settlement.
- Recognize the dangers of purchasing a former spouse's interest in property particularly a marital residence and its tendency to create deferred tax liability.
- Specify common disposition alternatives available on divorce and identify the home sale exclusion requirements and the tax treatment and use of installment obligations under §453 in divorce.
- Recognize sale, redemption, recapitalization, liquidation and third-party transfers as methods of dividing a business in a marital settlement citing unique provisions under §302, §736 and §754.
- Identify an overall tax and economic strategy for the division of pension benefits in a marital settlement.
- Specify types of §71 “divorce or separation instruments” and deter-mine how having an invalid decree, an amended instrument, or a pre-marital agreement impacts such an instrument.
- Identify variables that impact whether a payment is alimony since 1984 and whether a cash payment is deemed made to or on behalf of a former spouse.
- Identify what rent or resident cost payments can be alimony when a family residence is jointly owned and occupied by a spouse or a taxpay-er is required to make rent payments for a spouse.
- Specify the differences between child support and alimony identifying their tax treatment to avoid reporting errors.
- Identify the pre-2019 deduction of alimony paid and the reporting of alimony received on the proper forms specifying required information.
- Recognize the use of alimony trusts to realize tax advantage and security, determine the use of annuity contracts, and specify the proper tax treatment of alimony paid by an estate to a former spouse of a de-cedent.
- Recognize the COBRA and qualified medical child support order rules.
- Identify the marriage penalty and marriage bonus associated with filing a joint return.
- Recognize the application of federal estate tax on couples and where estate planning may be necessary as a result of marital status including the unique application of dower and curtsey.
- Specify the treatment of co-tenancies with or without a right of sur-vivorship identifying qualified joint interests, recognize the impact on the value of a general power of appointment, determine what insur-ance proceeds are included in the gross estate because of incidents of ownership and cite the community property issue involved with owner-ship of life insurance.
- Identify marital deduction variables including deduction limitations and specify the federal income tax treatment and gift tax treatment of non-citizen spouses.
- Recognize the effect common transactions and community property have on §1014 property basis and the benefits of a bypass trust specify-ing its effect on the marital deduction.
- Determine the purposes of the federal gift tax identifying its compu-tational methods and applicable exclusions, specify the advantages of splitting gifts and the gift tax marital deduction recognizing dangers as to “excess” gifts and terminable trusts and identify Social Security eli-gibility for family members of a system participant.
General understanding of federal income taxation.
Type of Delivery Method:
Recommended CPE Credits:
Final examination expiration date:
The program participant will have one year from the date of purchase to complete the course and final examination.
Web CPE is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org