Ed Shaw Law - Brainerd Attorney
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Coronavirus Impact and Assurance: Yes! We are still open for business!

As you are all aware, we are currently facing unique challenges due to the Coronavirus. While this is a serious crisis, it is important to keep it in perspective, and not allow it to prevent us from going about our business. We want to assure all of our clients that this office is prepared to serve your needs, regardless of what happens and how the virus affects Minnesota. In an effort to keep the office safe, we have stepped up prevention and sanitation measures in hopes to prevent disease transmission.

Because we are a paperless office, our entire staff is prepared to work from home if necessary. No matter what happens, we will continue to provide our clients with the highest quality legal services.  So far, not one client or staff member has become infected based on contact at this office and we will continue with safety protocols in an attempt to keep it that way. My office will continue to put the safety of our staff and you as our top priority. We do greatly appreciate your cooperation in conducting business in a safe fashion by utilizing current technology. Regardless of what happens, we will continue to take care of all of your legal needs.

Please rest assured, we will continue to take care of your legal needs in this challenging time, and your safety is our highest priority.

Please see our blog for more info on pandemic response.

Managing a divorce following new alimony tax laws

| Dec 27, 2018 | Divorce

When couples in Minnesota contemplate divorce, they likely think about how they will divide up their assets, who will have custody of any children involved, who will get the home or whether it’s best to sell the home and then divide the assets. As of Jan. 1, 2019, divorcing individuals will face new tax guidelines that may impact how they go about making these decisions.

For more than seven decades, tax law stipulated that the money an individual paid to their ex-spouse as alimony was tax-deductible. Conversely, the money an individual received as alimony from their ex-spouse was considered taxable income. As a result of the changes in tax law, this will no longer be the case.

Other changes that went into effect in 2017 include a change on mortgage interest deductions. Prior to this change, mortgage interest deductions were capped at $1 million. Now, they are capped at $750,000. This may affect whether one of the spouses wants to keep the house as keeping the house may not have the same tax benefits as it did in years past.

A good option that some spouses may consider is the division of property payments as opposed to alimony. As an example, the couple could sell their home worth $1 million, and one spouse could have the responsibility of paying the other spouse $500,000 over the period of multiple months or years. Division of property is a nontaxable event.

The downside of doing this is that if one spouse files for bankruptcy, the bankruptcy could lead to the division of property payments disappearing. Alimony is usually not discharged in a bankruptcy.

A family law attorney may help their client by providing them advice and guidance as they go through the divorce proceedings. An attorney may be able to help their client understand property valuation, draw up documents pertaining to child custody and alimony payments and represent their client in court if needed.