Custody and Non-Parents

In New York, non-parents, including grandparents, may obtain custody under limited circumstances. However, non-parents face a significant burden of proof which needs to be surmounted in order to obtain custody. Where a non-parent can show “extraordinary circumstances”, a court may find that they have standing to seek custody. After determining whether a non-parent has standing, the court must still decide whether allowing such person to have custody is in the best interests of the child, using the standard best interest of the child test, in the same way that parental custody is determined.

The origins of “extraordinary circumstances” standard are more than 30 years old. In 1976, the New York State Court of Appeals held that when a custody dispute between a parent and a non-parent arises, the parent’s superior right to custody could be disturbed only if extraordinary circumstances are proven and if it can be shown that it is in the child’s best interest for a non-parent to have custody. Bennett v. Jeffreys, 40 N.Y.2d 543 (1976). Typical examples of extraordinary circumstances are when a parent is unfit, where there is persistent neglect of a child by a parent, or where the parent abandons the child.

The Bennett case involved a 15 year old unwed mother who gave birth to her child while living with her parents. Under pressure from her mother, the girl reluctantly transferred the child to the care of Ms. Jeffreys, a former classmate of her mother. Ms. Jeffreys failed to adopt the child because she couldn’t afford to. When the biological mother was 23, and about to graduate from college, she brought a proceeding in Family Court to obtain custody of her child. But the Family Court dismissed the petition, directing that custody of the child remain with Ms. Jeffreys. The biological mother was awarded visitation rights.

The Appellate Division reversed the decision of the Family Court and directed Ms. Jeffreys to return custody to the biological mother because she had not surrendered nor abandoned the child, and was not unfit. The Court of Appeals subsequently reversed the Appellate Division, holding that where “extraordinary circumstances” exist such as an extended separation of the child from his or her biological parents, the best interests of the child were superior to the custody rights of a biological parent.

Extraordinary circumstances differ from case to case, however, the recent amendment to the Domestic Relations Law §72 gives grandparents extra consideration in that an “extraordinary disruption of custody” of at least 24 months, is described by the statute as an “extraordinary circumstance”.

Grandparents’ Right of Visitation

In New York, grandparents have a right to seek assistance of the court to obtain visitation with their grandchildren. That right is included in both the Domestic Relations Law and the Family Court Act. Section 72(1) of the Domestic Relations Law states that

“[w]here either or both of the parents of a minor child, residing within this state, is, or are deceased, or where circumstances show that conditions exist which equity would see fit to intervene, a grandparent may apply to [supreme or family court] and . . . the court, by order after due notice to the parent or any other person or party having the care, custody, and control of such child, to be given in such manner as the court shall prescribe, may make such directions as the best interest of the child may require, for visitation rights for such grandparent or grandparents in respect to such child.”

Section 72(1) “does not create an absolute or automatic right of visitation. Instead, the statute provides a procedural mechanism for grandparents to acquire standing to seek visitation with a minor grandchild”. Wilson v. McGlinchey, 2 N.Y.3d 375, 380 (2004). When grandparents seek visitation under §72(1), the court must undertake a two-part inquiry. “First, [the court] must find standing based on death or equitable circumstances”; and “[i]f [the court] concludes that the grandparents have established the right to be heard, then it must determine if visitation is in the best interest of the grandchild”. Emanuel S. v. Joseph E., 78 N.Y.2d 178, 181 (1991).

Since 1976, visitation may be awarded to grandparents in matrimonial actions. The 1976 amendment added the following to DRL §240: “Such direction [of a court in a matrimonial action] may provide for reasonable visitation rights to the maternal or paternal grandparents of any child of the parties.” In New York, the statute provides that grandparents may obtain visitation rights even though their child is not deceased, and the nuclear family is intact.

Last year, the Court of Appeals in E.S. v. P.D., 8 N.Y.3d 150 (2007), unanimously rejected a constitutional challenge to New York’s grandparent visitation law. In upholding the New York Law which permits grandparents, under certain circumstances, to seek visitation with their grandchildren, the Court distinguished the New York law from the overly broad Washington law struck down by the United States Supreme Court in Troxel v Granville, 530 U.S. 57 (2000).

The statute invalidated in Troxel permitted “‘[a]ny person’ to petition for visitation rights ‘at any time,’ and authorize[d] that court to grant such visitation rights whenever ‘visitation may serve the best interest of the child'” (Troxel, 530 U.S. at 60 [quoting Wash Rev Code § 26.10.160(3) (1994)]). The Washington statute explicitly applied a presumption in favor of grandparent visitation, placing on the parent “the burden of disproving that visitation would be in the best interest” of her children.

The New York Statute, on the other hand, is based upon the presumption that the parent’s wishes represent the best interests of the children. The Court noted that:

. . . courts should not lightly intrude on the family relationship against a fit parent’s wishes. The presumption that a fit parent’s decisions are in the child’s best interests is a strong one. And while, as we made clear in Wilson, the problems created by parent-grandparent antagonism cannot be ignored, an acrimonious relationship is generally not sufficient cause to deny visitation. “It is almost too obvious to state that, in cases where grandparents must use legal procedures to obtain visitation rights, some degree of animosity exists between them and the party having custody of the child or children. Were it otherwise, visitation could be achieved by agreement” (Lo Presti v. Lo Presti, 40 N.Y.2d 522, 526 (1976)).

While this presumption creates a significant burden for the grandparent, the grandmother in this case was able to overcome it, because from the time the child was almost four until he was seven, grandmother was the primary caretaker. The court then considered all of the many circumstances bearing upon whether it was in the child’s best interest for his relationship with grandmother to continue, such as whether the father’s objections to grandmother’s access to the child were reasonable, her caregiving skills and attitude toward father, the law guardian’s assessment and the child’s desires, before granting visitation.

Tax Issues in Custody and Divorce

As we come to the end of the year, I am often asked about different tax issues applicable to my clients’ situations.

If my client’s divorce will not become final before the end of the year, the parties can still file a joint tax return. Once the judgment of divorce has been filed, an ex-spouse can file the return as a head of household, if he or she has paid for over half the maintenance of the household, and has a dependent living at his or her home for over half the year.

When the parties are divorced, only one of them can claim the $3,500 child dependency exemption on their tax returns for 2008. The parent claiming the dependency exemption is also allowed a $1,000-per-child tax credit for children younger than 17, as long as his or her income is not above the following cut-offs. For a married couple filing jointly, it is $110,000, for a married couple filing separately, it is $55,000 per spouse, and for all others, it is $75,000. If the applicable income exceeds the above thresholds, the amount of the child tax credit is reduced proportionately.

Usually, it is the person named as the custodial parent in the child custody portion of the divorce decree that is allowed to claim the child as a dependent. If the divorce decree does not name a custodial parent, then the parent with whom the child has lived with the longest throughout the year is the custodial parent.

A non-custodial parent, however, can claim the child dependency exemption, as long as the custodial parent signs a waiver promising not to claim the exemption. This is typically accomplished by the use of IRS Form 8332. However, the recent amendments of the IRS regulations dealing with this issue have complicated this issue. The final regulations provide that a release not on a Form 8332 must be a document executed for the sole purpose of releasing the claim. A court order or decree or a separation agreement cannot serve as the written declaration. If a release of a claim to a child is for more than one year, the noncustodial parent must attach a copy of the written declaration to the parent’s return for the first tax year for which the release is effective. Copies must also be attached to returns for later years. Under the final regulations, a custodial parent who released the right to claim a child, can revoke the release for future tax years by providing written notice of the revocation to the other parent. The final regulations require that the parent revoking the release notify, or make reasonable attempts to notify, in writing, the other parent of the revocation. What is a reasonable attempt is determined under the facts and circumstances, but mailing a copy of the written revocation to the noncustodial parent at the last known address or at an address reasonably calculated to ensure receipt satisfies this requirement. A revocation can be made on Form 8332, or successor form designated by IRS. A revocation not on the designated form must conform to the substance of the form, and be in a document executed for the sole purpose of revoking a release. A taxpayer revoking a release may attach a copy rather than an original to the taxpayer’s return for the first tax year the revocation is effective, as well as for later years.

Yet another related issue is who can claim the child as dependent under the group health plan coverage and health savings account (“HSA”) distributions. Under the final regulations, for purposes of group health plan coverage and health savings account (HSA) distributions, both parents can claim the child as a dependent if: (1) the child qualifies as a dependent of one of the parents; (2) the parents (both parents together) provide more than ½ of the child’s support for the calendar year; (3) the child is in the custody of one or both parents for more than ½ of the calendar year; and
(4) the parents are divorced, legally separated under a decree of separate maintenance, separated under a written separation agreement, or live apart at all times during the last six (6) months of the calendar year.

If a non-custodial parent claims the child exemption first, and without the custodial parent’s permission, he or she is likely to receive the exemption temporarily. However, once the custodial parent files his or her tax return including the exemption, and IRS notices that a child’s social security number has been included on two different tax returns, then both parties would be notified by IRS that only one party is entitled to the exemption, and the tie-breaker rule would be used to resolve this situation. This rule says that if two parents claim that a child as a dependent, the parent with whom that the child lived with the longest during the year, receives the exemption. If the child had spent the same amount of time with both parents, then the parent that had the higher adjusted gross income would get the exemption. The parent who was not entitled to the exemption would have to repay the tax, plus penalties and interest.

Regardless of who the custodial parent is, if the non-custodial parent pays for any of the child’s medical bills, these costs can be a deduction, subject to appropriate income limits. Child-care credit for work-related expenses can be claimed for children younger than 13.

The spouse who pays maintenance or spousal support can also receive a tax deduction for these payments, even if they aren’t itemized—as long as the payment amounts are stated in the divorce agreement or the judgment of divorce, and actually paid. The spouse who receives maintenance must pay taxes on it. For child support, however, there is no deduction for paying it and no taxes are paid by the parent receiving it. Assets transferred from one spouse to another during a divorce are not generally taxed.

Please note that the above discussion is not a tax advice and these issues should be discussed with your tax professional.

Divorce, Immigrant Spouse, Maintenance and Affidavit of Support

When either a husband or wife marries someone who is not a legal resident of the United States and brings them to this country, as a part of his/her immigration application, the spouse who is a citizen of the United States certified that he/she would provide support for their spouse once that spouse is in the United States and would not allow her to become a public charge. See 8 U.S.C. §1182(a) (which prohibits immigration when the immigrant has no means of support and is likely to become a public charge). This requirement is satisfied by what is known as an affidavit of support, I-864 form. By signing it, the party certifies that he/she would provide to their spouse with income of 125% of the Federal Poverty Level guidelines. For 2008, the Federal Poverty Level guidelines state that the poverty level income for a household of one is $10,400.00, and the corresponding income level under the affidavit of support is $13,000.00.
According to the Appellate Division, Fourth Department, where a party signs an affidavit of support, from I-864, that affidavit is a legally enforceable contract. Moody v. Sorokina, 40 A.D.3d 14 (4th Dept. 2007). In that case, a Ukrainian national emigrated to the United States to marry her eventual husband in New York. When the husband filed for divorce several years later, the wife sought to enforce the Affidavit of Support for purposes of determining the amount of support payments to be made by the husband. While the trial court rejected the wife’s argument and held that the affidavit could not be enforced in court by private parties, the Appellate Division, Fourth Department reversed the lower court and held that the affidavit of support was enforceable. The Appellate Division held that the execution of a affidavit of support creates a legally enforceable agreement between the parties involved that can be enforced by the sponsored immigrant in any federal or state court. Id. at 401. Moreover, the Fourth Department explained that the terms of the agreement are not affected by a subsequent judgment of divorce. As such, the agreement remains fully binding on all parties until the sponsored immigrant “has worked 40 qualifying quarters of coverage,” as defined by the Social Security laws. The enforcement of the right of support also includes attorneys fees. Id.
Therefore, when the spouses separate and the immigrant spouse is unable or unwilling to work, the spouse who is a citizen of the United States will be responsible for their spouse’s support until such time as that spouse becomes self-sufficient, or perhaps even indefinitely.

Interstate Custody Disputes and Jurisdictional Issues

Periodically I am asked about jurisdictional issues that arise when one parent and/or their child relocates to out of state and the other wishes to petition the court for child custody or visitation, a modification or change in custody or enforcement of a custody order. Although there are cases where the noncustodial parent seeks court intervention because of the fact that the custodial relocated without permission, there are in fact times where consent was given initially but subsequent events may raise a need for a modification or enforcement of the current custody order.

New York has adopted the Uniform Child Custody Jurisdiction and Enforcement Act (“UCCEJA”). This statute attempts to discourage interstate child abductions and to prevent “forum shopping” by parents trying to remove the child to a state to avoid another state’s jurisdiction. The statute explicitly sets forth the circumstances in which New York courts have jurisdiction, particularly when one parent and/or the child no longer resides in New York. While UCCEJA issues are most commonly seen in family court petitions seeking custody or visitation, modifications and enforcements of custody or visitation orders, it also applies to guardianship, divorce, paternity, child abuse or neglect, termination of parental rights and domestic violence cases. Since jurisdiction is usually not in issue when the child lives in New York or has moved from the state within six months of filing the petition, the UCCJEA helps to iron out jurisdictional issues in other circumstances where the child’s residence is in question based on a move from the state or his or her physical presence in the state. These include cases where the noncustodial parent lives in New York but the child does not; where the child moved from the state more than six months prior to the filing of the petition (but without the noncustodial parent’s consent or to somewhere unknown to that parent); or where the child is in New York and there are concerns of abuse or neglect. These are all scenarios that require the application of the UCCJEA.

The UCCJEA sets forth alternative situations for asserting jurisdiction, which are: 1) where it is in the best interests of the child based on the “significant connections” to the state and there is “substantial evidence” within the court’s jurisdiction concerning the child’s current or future care; 2) where there is an emergency situation ; 3) where no other state has jurisdiction or 4) another state has refused jurisdiction.

Situation 1: This section only applies to cases where there is no home state and there has not been a home state for the past six months. This limitation is imposed by the federal statute, the Parental Kidnapping Prevention Act which trumps the UCCJEA because of the constitutional supremacy clause (Article VI, Clause 2). This act serves to provide more uniformity amongst states, resolve conflicts between various states that may have an interest and to address the inconsistency caused by the application of the prior act, the Uniform Child Custody Jurisdiction Act (“UCCJA”), which was the basis for states applying their own version resulting in inconsistent orders. Its objective is to avoid forum shopping, while encouraging the preference for the issuing state to maintain jurisdiction so long as one of the parents or the child remains a resident of the state. Based on this, as well the two part analysis required to meet the criteria, there are rare cases where this particular section applies. For example, showing that there are “significant contacts with the state” may be attainable, but proving that there is “substantial evidence” concerning the child’s current or future care is much more challenging.

Situation 2: This section applies mainly in child abuse or neglect cases or where the child was abandoned by the parent or legal guardian. However, although the act serves to limit jurisdiction to situations where some immediate attention should be given, the statute is strictly construed. In other words, a mere allegation of abuse or neglect is not enough, the courts must be convinced that abuse or neglect actually exist, placing the child’s physical and/or emotional well-being into question. And even still, the courts may assert only limited or temporary jurisdiction, deferring the case to the home state of the child for further proceedings. Furthermore, the child must physically be present in the state, and cannot be removed from the state for any reason under this provision.

Situation 3: This section typically applies in cases where the child has not had a home state anywhere during the previous six months, (no significant connections or emergency situation exists). This is a safety measure included in the statute to avoid the case going unheard by any court. Cases like this arise when the child moved from New York, then to another state for a short period (less than six months), then back to New York less than six months before the filing of the petition.

Situation 4: This section applies to cases where another state, presumed to have been the child’s home state, has denied jurisdiction based on its own provisions. Typically states will deny jurisdiction for lack of significant ties, there is a case already pending in another state, there is a more convenient forum or merely for parties’ failure to ascertain legitimate residence (as is the case when parents take the child from another state and hide him or her from the noncustodial parent long enough to establish jurisdiction).

When it comes to modifying a child custody order in New York that was issued by another state, New York will not exercise jurisdiction unless the state that entered it no longer has jurisdiction. So even if it is the non-custodial parent that remains in the issuing state, while the child and the custodial parent relocated to New York, that state still has jurisdiction unless it declines jurisdiction. Conversely, New York will enforce a custody order if the child and one parent lives in the state, if the order is registered in New York.

Divorce and Leaving Marital Residence

One of the most common questions asked at the beginning of a divorce case is whether my client can move out of the house. Most of the time, my advice is to stay. Often, it is not what my clients want to hear, however, there may be good reasons not to leave.

The most significant ones are as follows:

Initially, any such move will fundamentally change each party’s negotiating position. In a typical divorce case, if one party stays in the marital home, the other party may be directed by the court to contribute to the mortgage. At the same tine, the party who moved out will have other expenses related to their new residence. This clearly places that party in a disadvantageous financial position.

Leaving the home may jeopardize that party’s custody claim. In a custody dispute, if the children remain in the home with the other spouse, this is highly likely to damage the moving party’s custody claim. If the case takes a long time to resolve, the facts on the ground, i.e., the residence of the children will work against that party. The courts tend to perpetuate status quo with respect to custodial arrangements, and that means that the court would not be likely to direct the children to move, and would be likely to continue existing visitation arrangements.

The move may also have effect on equitable distribution, since it is not uncommon for the courts to grant to the party who was paying expenses associated with the home a credit for the payments made. The credit may significantly impact each parties’ financial situation at the end of the divorce. It may have other economic impact on the parties as well.

The same question receives a different answer if there is domestic violence in the home. Above all other considerations, I advise my clients to protect themselves. In situations involving domestic violence, it is possible to have your spouse removed from the home by obtaining an order of protection even prior to commencement of a divorce action.

Divorce, Attorneys Fees and Unequal Economic Positions of the Parties

I am often asked whether in a situation where one party controls all the money, is the other party entitled to attorneys’ fees? The concept of interim awards of legal fees is often critical. Potential clients meet with me and tell me that they cannot afford to hire me, and other party is going to win the case because he/she can afford an expensive attorney. The courts in New York are mindful of this problem and tend to grant attorney fees to the non-monied spouse.

In order to ensure that the parties will have equal access to competent legal representation, the Domestic Relations Law authorizes awards of interim counsel fees to the non-monied spouse during the course of the litigation. Because of the importance of such awards to the fundamental fairness of the proceedings, an application for interim counsel fees by the non-monied spouse in a divorce action should not be denied — or postponed until after the trial, which functions as a denial of such fees, without good cause.

The Domestic Relations Law provides that, in an action for divorce, “the court may direct either spouse . . . to pay such sum or sums of money directly to the attorney of the other spouse to enable that spouse to carry on or defend the action or proceeding as, in the court’s discretion, justice requires, having regard to the circumstances of the case and of the respective parties”. See Domestic Relations Law § 237[a]. The court may direct such payments in the final judgment and/or “by one or more orders from time to time before final judgment”. Id. The Court of Appeals has explained that Domestic Relations Law § 237:

“is designed to redress the economic disparity between the monied spouse and the non-monied spouse. Recognizing that the financial strength of matrimonial litigants is often unequal — working most typically against the wife — the Legislature invested Trial Judges with the discretion to make the more affluent spouse pay for legal expenses of the needier one. The courts are to see to it that the matrimonial scales of justice are not unbalanced by the weight of the wealthier litigant’s wallet” (O’Shea v. O’Shea, 93 N.Y.2d 187, 190 (1999)).

An award of counsel fees pursuant to Domestic Relations Law § 237(a) is a matter within the sound discretion of the trial court, and the issue “is controlled by the equities and circumstances of each particular case”. Timpone v. Timpone, 28 A.D.3d 646 (2nd Dept. 2006). In determining whether to award fees, the court should “review the financial circumstances of both parties together with all the other circumstances of the case, which may include the relative merit of the parties’ positions”. DeCabrera v. Cabrera-Rosete, 70 N.Y.2d 879, 881 (1987). The court may also consider whether either party has engaged in conduct that caused a delay of the proceedings or resulted in unnecessary litigation. Ciampa v. Ciampa, 47 A.D.3d 745, 748 (2nd Dept. 2008).

An award of interim counsel fees ensures that the non-monied spouse will be able to litigate the action, and do so on equal footing with the monied spouse. Such an award “is appropriate to prevent the more affluent spouse from wearing down or financially punishing the opposition by recalcitrance, or by prolonging the litigation”. O’Shea v O’Shea, 93 N.Y.2d at 193.

Although interim counsel fees are normally payable directly to the attorney representing the non-monied spouse, there is no prohibition to directing payment of fee awards directly from the monied spouse to the non-monied spouse.

Basics of Maintenance

Maintenance is set forth in the Equitable Distribution Law, DRL, Section 236, Part B. Prior to the enactment of DRL Section 236 was enacted, the statute used the term “alimony”.

The statutory factors, pursuant to Domestic Relations Law Section 236(B)(6), relative to the consideration of maintenance are as follows:

(1) the income and property of the respective parties including marital property distributed pursuant to Domestic Relations Law Section 236(B);
(2) the duration of the marriage and the age and health of both parties;
(3) the present and future earning capacity of both parties;
(4) the ability of the party seeking maintenance to become self-supporting and, if applicable, the period of time and training necessary therefore;
(5) reduced or lost lifetime earning capacity of the party seeking maintenance as a result of having foregone or delayed education, training, employment, or career opportunities during the marriage;
(6) the presence of children of the marriage in the respective homes of the parties;
(7) the tax consequences to each party;
(8) contributions and services of the party seeking maintenance as a spouse, parent, wage earner and homemaker, and to the career or career potential of the other party;
(9) the wasteful dissipation of marital property by either spouse;
(10) any transfer or encumbrance made in contemplation of a matrimonial action without fair consideration;
(11) any other factor which the parties or the Court expressly find just and proper.

In resolving the issue of the appropriate amount of spousal maintenance, the parties in settlement, or a court in trial, must have regard for the standard of living of the parties established during the marriage, whether the party in whose favor maintenance is granted lacks sufficient property and income to provide for his or her reasonable needs, and whether the other party has sufficient property or income to provide for the reasonable needs of the other and the circumstances of the case and of the respective parties.

The court is charged with looking at all sources of income and property that the parties are able to receive in equitable distribution. Income derived from separate property may also be considered by the court. Maintenance (similarly to child support) are determined on the basis of earning capacity, not necessarily earnings! It is, therefore, well within the purview of the court to impute income to one or both parties in determining the basis for the award of maintenance.

The court is required to look at the present and future earning capacity of both parties so be sure to address for both not only their current situations, but respective abilities to be self-supporting in the future, ability to continue to earn in the future and for what period of time, skills and training, and future prospects. The ability to be self-supporting is very fact sensitive and requires careful analysis. Do not just think of Factor #4 as relating to a spouse in a longterm marriage who has not worked in over 20 years, is in mid- to late-50’s, etc., but apply facts to a spouse with young children, still nursing, etc. Self-sufficiency depends upon the ability to achieve a lifestyle equal to that enjoyed during the marriage.

It is the responsibilities of the attorneys for the parties to make the court aware of the tax consequences to a payor spouse and payee spouse. Expert
testimony will be needed to provide the court with the tax impact upon each party of various maintenance scenarios, to allow the court to determine which amount most meets the demonstrated needs of the payee and the ability of the payor to make the payments.

Most often considered under the catch-all factor #11 is the issue of fault. While fault may not be considered in the equitable distribution of the marital estate unless it is egregious, there is no such standard applicable to fault as it relates to an award of maintenance. While marital fault does not preclude an award of maintenance, it is a relevant factor which can be considered. Maintenance can be directed by the court, or can be provided for in a “valid” agreement between the parties. An award of maintenance is ultimately in the discretion of the court. The overriding purpose of spousal maintenance is to enable the receiving spouse to achieve financial independence.

The reason for imposing a time limitation upon a maintenance award is usually to give the supported spouse a reasonable period of time in order to learn or update work skills and enter the work force with a view to being self-supporting. The court may award permanent maintenance. DRL Section 236(B)(9). Permanent, or non-durational, maintenance may be appropriate where one spouse’s energies during the marriage where primarily devoted to homemaking and childrearing to the detriment of being able to become self-sufficient and maintain the pre-divorce standard of living. The court cannot make an open-ended award in terms of the amount that is to be paid; there must be a set number.

On the other hand, durational maintenance is that which is required for a fixed period of time to allow the receiving spouse to become self-supporting and in recognition of the predivorce standard of living. Maintenance terminates upon the death of either party or upon the recipient’s valid or invalid marriage. DRL Section 236(B)(6)(c).

Maintenance is deductible by the payor spouse and is includable in the recipient spouse’s income. However, if a payment is not true maintenance, the IRS will not allow it as a deduction. A person’s marital status is determined, for tax purposes, as of the end of the calendar year. IRC Section 143(a)(1). Therefore, a person who weds on December 29th is considered married for the whole year and, conversely, a person whose divorce is finalized on December 29th cannot file as a married person. A divorce becomes final on the date the judgment is filed in the county clerk’s office. However, the parties can agree, or the court can order, that the maintenance payments are not taxable to the recipient and not an adjustment to the income of the payor. 26 USCA Section 71(b)(1)(B). The court must have a clear rationale for ordering the payments non-taxable.

Where maintenance and child support are both payable, the amount of maintenance must first be deducted before calculating child support. Family Court has jurisdiction to provide support to a spouse, rather than a former spouse.

Bankruptcy and Divorce

When your ex-spouse files for bankruptcy, all efforts to collect any debts have to stop unless they fit within one of the exceptions in the bankruptcy statute. This is known as the “automatic stay.” One exception to the automatic stay is the one that allows the commencement or continuation of a proceeding to establish or modify a support award or collect support from property that is not property of the bankruptcy estate. 11 U.S.C. 362(b)(2).

Current support debts survive a bankruptcy without the need for you to have to go to bankruptcy court. Under the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, among the changes in creditor priority is that unpaid child support and alimony has priority over any other creditor, including taxes owed. If you are owed back support it is very important that you file a “proof of claim” with the bankruptcy court to receive payment.

The bankruptcy law requires the trustee in bankruptcy, if there is a claim for a domestic support obligation in a case, to provide written notice to the party to whom the domestic support obligation is owed, and to the state’s Child Support Enforcement Agency. A notice at the time of filing and a second notice at the time of discharge are required. In the notice to the creditor, the trustee must provide contact information for your state’s Child Support Enforcement Agency.

The new bankruptcy law made non-support obligations from a divorce or separation non-dischargeable in a chapter 7 bankruptcy, if the discharge of the obligation would harm the spouse to whom the obligation is owed more than it would harm the person who owes it, your ex-spouse. 11 U.S.C. 523(a)(15). A debt that is non-dischargeable means that your ex-spouse is still responsible for it. You would need to file a complaint in bankruptcy court to get the property settlement debt excepted from discharge. If you don’t file a claim with the bankruptcy court, the debt may be wiped out and you won’t be able to collect it later.

The discharge in a chapter 13 case is somewhat broader than in a chapter 7 case. Debts dischargeable in a chapter 13, but not in chapter 7, include debts arising from property settlements in divorce or separation proceedings.

How do bankruptcy courts decide what’s a support obligation and what’s a property settlement? The courts have based their decisions on such questions as:

Does the obligation terminate or reduce with the occurrence of certain events, like remarriage or a child turning 18?
Is the obligation in installments or a lump sum?
Are there minor children?
What is the relative health and education of the parties?
Was there a need for support at the time of the divorce?

The way in which the judgment of divorce is drafted can reduce the chance that the bankruptcy court will discharge the debt. The likelihood that the debt will not be discharged by labeling the debt payments as either support or alimony in the decree.

If you’re listed as a creditor on your ex-spouse’s bankruptcy petition, you should receive notice from the bankruptcy court of the filing and information about the date and time of the first meeting of creditors (known as a “341 meeting”). You should also receive information on the deadline for filing a claim and a proof of claim form for filling out.

Starting a practice and starting a blog

After spending the last 12 years practicing in a mid-size firm setting in Rochester, I have left my job and started my own practice. As of Monday, July 28, 2008, The Law Office of Alexander Korotkin, Esq. is open for business. In conjunction with running my practice, which is not limited to family law matters, I intend to publish this blog which will focus primarily on Family Law.