Blog Migration

I have some exciting news, Life (tax and finance) After Divorce has migrated and become part of the suite of blogs provided by White, Zuckerman, Warsavsky, Luna and Hunt.  All of the same great content and support provided to divorced and divorcing individuals will be found over there along with  three other blogs as follows:

Forensic Forum is designed to provide information related to forensic accounting in family law matters.

Wealth Builder is designed to provide you with the latest tax planning ideas and other financial opportunities that can enhance your wealth.

CFO Corner is designed to provide information that will be of use to CFOs and other business operators and managers. We intend to provide information that will assist you in operating and managing your businesses covering a variety of issues from the world of business including business taxation, financial statements and GAAP, management, benefits, and other areas with an emphasis on streamlining efficiency and improving profits.

Please bookmark any or all of the above blog links and navigate to the lower left corner of our Blog Home Page under Newsletter to sign up for future email alerts to all of this great content as this blog will not be supported going forward.

 

How Long Should I Keep My Records?

I apologize for the long absence of any new content on this blog; however, I took a hiatus during tax season and have had a tough time getting back on track.  In any event, a client of mine recently raised a question which I believe may be relevant to many of you – how long should I keep my records?  If record space is a concern for you consider the following:

Generic tax rules

  • Keep all tax (or potential tax) records for three years from the later of April 15 (after the tax year) or when the original tax return was filed or after an amended tax return was filed.
  • Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction on the tax return.
  • Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return. Yes the statute of limitations is extended if there is an understatement of tax in excess of 25%.  Hard to know what you don’t know but I assume this does not apply to any of you?
  • Keep records indefinitely if you do not file a return. If you didn’t file because you were below the filing thresholds, this should not be much of an issue.
  • Keep records indefinitely if you file a fraudulent return. Yes the statute never runs out if you commit fraud so please don’t do that!
  • If you have a business with employees you should keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later?

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Innocent Spouse Relief

Happy New Year 2015, this is always a time for a new start. No matter what problems you are going through you can make them better by obtaining good information – e.g. the information provided on this blog site – and implementing plans to deal with the problems.

One of my early blog posts, way back on August 5, 2014, dealt with the topic of escaping the requirement to report a share of community property income if you and your spouse file separate income tax returns (see Other Relief From Community Property Rules). Continue reading

Year-End Tax Planning and 2014 Tax Law Changes

As noted on the “About” page, one of the purposes of this blog is to offer tax savings strategies. As each calendar year nears it’s close, we work with our clients to implement various strategies to reduce their taxes for the year (or in some cases increase them for the purpose of reducing them even more in the following year).  The strategies summarized below comprise the general rules for reducing income taxes year to year and should be considered throughout the year. Continue reading

Divorce with Children: Consulting With Mental Health Professionals

I recently attended a family law “study group” sponsored by White, Zuckerman, Warsavsky, Luna & Hunt and the speaker was a mental health professional who spoke on the subject of “reunification therapy”.  I thought she gave a good presentation and I asked her if she would care to provide a guest blog article covering the role of the mental health professional in marital dissolutions. She readily agreed and the following is her initial article:

Carolyn Cater Nishimoto, MSW, L.C.S.W.
1633 E. Fourth Street, Suite 144
Santa Ana, CA 92701
(714) 541-5582

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Should I Sign That Joint Tax Return

As some of you procrastinators may be aware, the October “tax season” just ended. As a result, in the last few weeks I was asked numerous times to evaluate whether or not one of the spouses undergoing a marital dissolution should sign a “married filing joint” tax return prepared by their spouse (or their spouses advisors).  The reason this question gets asked so often in these situations is because the spouse who did not prepare the joint return is afraid that the spouse who prepared the return may have understated the income or perhaps overstated deductions.   Continue reading

California Property Tax Basis Rollover

I recently had the honor of speaking at a workshop sponsored by the Los Angeles Collaborative Family Law Association about a variety of divorce related tax topics.  Somewhat to my surprise the participants were particularly interested in the topic of California real property taxes and the available basis rollover, especially a few divorce related nuances of which I wasn’t fully versed in at the time of the workshop. As a result, I have fully researched the topic. The following is a summary of the key provisions: Continue reading