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LONICH PATTON EHRLICH POLICASTRI
1871 The Alameda, Suite 400, San Jose, CA 95126
Phone: (408) 553-0801 | Fax: (408) 553-0807 | Email: contact@lpeplaw.com
LONICH PATTON EHRLICH POLICASTRI
Phone: (408) 553-0801
Fax: (408) 553-0807
Email: contact@lpeplaw.com
1871 The Alameda, Suite 400
San Jose, CA 95126
Located in San Jose, Lonich Patton Ehrlich Policastri handles matters for clients in northern California, specifically San Jose and Silicon Valley. Our services are available to anyone within the following counties: Santa Clara, San Mateo, Contra Costa, Santa Cruz, Monterey, San Benito, and San Francisco. For a full listing of areas where we practice, please click here.
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Special Rules that Regulate Transfers to Non-U.S. Citizen Spouses Can Affect Estate Planning
/in Estate Planning /by Michael LonichEstate planning can be particularly challenging for couples if one spouse is the citizen of another country. It is important for California residents, who are married to non-citizen spouses, to consider the special regulations surrounding estate tax marital deductions when creating an estate plan.
First, there is no standard estate tax marital deduction for a spouse who is not a U.S. citizen. While this may seem unfair, the rationale behind the estate tax marital deduction was to defer the tax until the death of the second spouse. If the non-citizen spouse moved out of the country after the death of the first spouse, he or she could not be subjected to the deferred taxation. However, if the non-citizen spouse becomes a citizen before the federal tax return is filed, the standard unlimited marital estate tax deduction will apply.
Second, while there is no gift tax marital deduction for lifetime transfers to a noncitizen spouse, there is an annual gift tax exclusion. The exclusion amount allowed for transfers during life to a non-citizen spouse was $133,000 in 2009.
For more information on how to create an effective estate plan, please contact our attorneys at Lonich Patton Erlich Policastri. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.
Premarital Agreements vs. Marital Agreements vs. Marital Settlement Agreements
/in Family Law /by Mitchell EhrlichCalifornia family law is quite complex. For those who are not familiar with the workings of California law, it may be very difficult to differentiate between the terms “premarital agreement,” “marital agreement,” and “marital settlement agreement.”
A premarital agreement is a contract that is executed between two prospective spouses. The premarital agreement, or “prenup,” is entered into in anticipation of marriage with the idea that it will become effective upon the marriage of the two prospective spouses. Premarital agreements often address issues of the parties’ present and future property rights. Premarital agreements must comply with certain formalities to be enforceable.
A marital agreement, or postnuptial agreement, is a contract that is executed by spouses during marriage. This type of contract affects the rights and obligations incident to an ongoing marriage, both during life and after death. Post-nuptial contracts can be broad in scope, laying out in comprehensive detail the parties’ rights and duties towards each other and the characterization of property. This category also includes “transmutation” agreements, which are contracts changing the property status of a specific asset from its current form to another form (e.g. separate property to community property). Like a prenuptial agreement, marital agreements must comply with certain formalities in order to be enforceable. Additionally, spouses entering into postnuptial agreements must comply with their fiduciary obligations and act with the “highest good faith and fair dealing” towards one another.
A marital settlement agreement (MSA) is executed as part of a dissolution of marriage or legal separation. The MSA typically addresses the parties’ ownership of marital property and other rights and obligations in relation to divorce or separation. Usually, an MSA is incorporated into a judgment of dissolution, and the rights and obligations of the ex-spouses are governed by the terms of the final judgment.
Note that the same rules governing these agreements between spouses also generally apply to domestic partnerships. For more information about prenuptial agreements, marital agreements, or marital settlement agreements, please contact us.
Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.
Is a Legal Separation the Best Option for You?
/in Family Law /by Julia LemonIf you do not want to proceed with a divorce but are interested in separating from your spouse, a legal separation might be an appropriate remedy. A legal separation may be appropriate for couples who have religious or other personal reasons for not wanting to proceed with a divorce. For example, some couples may not want to proceed with a divorce at the present time because a divorce may make them ineligible for medical insurance.
A legal separation is not a legal end to your marriage. In fact, if you are legally separated and decide to remarry, you must first obtain a judgment of dissolution for your first marriage. However, a legal separation does allow you to live apart from your spouse while making separate financial, parenting, and property decisions.
To find out more about legal separations, please contact Lonich Patton Erlich Policastri. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.
Is a Divorce Right for You?
/in Family Law /by David PattonIf you are currently living in northern California and are contemplating ending your marriage through a divorce, here is some basic information on what a divorce entails. A “divorce,” or “dissolution of marriage,” legally terminates your marriage or domestic partnership. After you are legally divorced, you are considered “single” and are free to remarry or enter into a new domestic partnership. However, a divorce is not right for every couple.
If you want to end your financial and personal life with your partner, but do not want a legal divorce, there are other alternatives for you. Some people may choose to pursue a “legal separation” instead. This is often done for religious reasons. A legal separation does not end a marriage or domestic partnership. Rather, it allows you to live apart and make independent decisions on finances, property, and child care issues.
Another alternative to a divorce is an annulment. However, this option is very rare. An annulment occurs when a court finds that your marriage or domestic partnership was never valid in the first place. Marriages may be void because the marriage was incestuous, bigamous, fraudulent, or one of the spouses lacked capacity to enter into the marriage.
For more information about divorce, legal separation, and annulment, please contact our attorneys at Lonich Patton Erlich Policastri. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.
Steer Clear of Potential Spousal Support Tax Pitfalls
/in Family Law /by Mitchell EhrlichGenerally speaking, spousal support is taxable to the recipient and is deductible by the payor. For example, if you are paying spousal support to your ex-wife the money she receives would be taxable to her as income. Likewise, generally you would be able to deduct it on your tax return. However, you may not be aware that there are several exceptions to this rule. In fact, it is necessary that you closely observe the spousal support formalities in order to take advantage of deducting payments to your ex-spouse.
In order for spousal support payments to be deductible, they must be made in cash. However, in this context, “cash” is not only currency. It can also include check or money orders payable on demand. The payment itself must be received on or on behalf of the supported spouse, and the spouse must be entitled to this payment under a divorce or separation instrument. As an illustration, if you and your ex-spouse privately decide you will pay her a certain amount per month, you cannot deduct this amount from your taxes as the payment was not made pursuant to a divorce/separation instrument. On the other hand, if your Marital Settlement Agreement states that you must pay your ex-wife, you can likely deduct the payments on your taxes.
In addition, the payment obligation must be limited by the recipient spouse’s death. For example, assuming that your settlement agreement requires you to make payments beyond your ex-spouse’s death, none of these payments are deductible support.
These are just some of the several requirements for deductible spousal support. For more information about making sure you are following the proper tax rules in relation to your spousal support payments, please contact the San Jose divorce attorneys at Lonich Patton Erlich Policastri. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.