Tuesday, February 28, 2012

The Uniform Child-Custody Jurisdiction and Enforcement Act

The Uniform Child-Custody Jurisdiction and Enforcement Act, aka the UCCJEA, is a law born out of necessity. Divorce is a trying and oft times complicated experience for anyone to go through. And today, the divorce rate is at an all time high. But what happens when there are children involved? In today's global society, we are a much more nomadic species than ever. Making it all the more difficult to divvy up custody rights if one of the parents decides to move out of state, or even out of the country. Which jurisdiction presides over the case? Child custody laws can vary from county to county within a single state. Which is why the UCCJEA has been so helpful in enforcing a singular protocol. The UCCJEA is merely a more specified and clarified version of its predecessor; UCCJA. As a result, conflicts have been greatly reduced nationwide in child custody cases. It is intended to reflect the Federal Parental Kidnapping Act (PKPA) which ensures interstate uniformity with regards to custody, and provides protection for victims of domestic violence who have relocated out of state for their own safety.
Locally, the state of Missouri adopted the act in August of 2009. Replacing the previous UCCJA as discussed above. Missouri was one of the last three states to employ the act. Since then, many have found their custody situation improved as have Parental Kidnapping issues have decreased.
A court being asked to exercise jurisdiction over a child will look for the following jurisdictional indicators:
  • Child’s home state on the date of the commencement of the proceeding, 
  • Child’s home state within six months prior to the commencement of the proceeding although the child is absent from this state, a parent or person acting as a parent continues to live in this state;
  • The child and his parent have a significant connection with this state other than mere physical presence; and
  • Substantial evidence is available in this state concerning the child's care, protection, training and personal relationships.
In the event two states qualify and cases are filed in both, the Courts will confer with each other directly and make a decision as to jurisdiction.  A court which has decided custody previously will exercise continuing jurisdiction over the case.
To illustrate:
A custody order is put in place in Topeka, Kansas regarding a child who is 6 years old, has lived in Topeka since birth with his mother and attended day care and school there, and sees the pediatrician there.  His mother rents a home there and she grew up there too and attended high school there.   Shortly after the custody order is put in place, mother is offered a job in Columbia, Missouri.  She moves to Columbia to pursue the job and brings the child along with her.
Father, a resident of Topeka, not happy about the disruption to his ability to visit, files an action in Topeka, KS court to enforce his visitation 3 months later.  Under the UCJJEA, the Topeka court has jurisdiction.
However, if Father waits 7 months before he files in Topeka, KS to enforce his visitation things are different.  Mother first files in Columbia, MO to change the parenting plan and serves Father with summons to the Missouri Court.  Father’s attorney contests jurisdiction of the Missouri court based on the continuing jurisdiction of the Kansas court.  The two judges get on the phone to sort things out.  After they conference on the phone with each other, the Kansas Court transfers jurisdiction of the case to the Missouri court because the significant contacts and residence and passage of time indicate the Missouri court is now the court with jurisdiction of the case.

Friday, February 17, 2012

Bankruptcy and Form 1099-C

According to the IRS, if a creditor writes off a debt that you owe, or if a debt with a creditor is settled for less than the full amount, you could owe money to the IRS. This includes debt from credit cards, car repossessions, foreclosures, etc.  Creditors that forgive $600 or more are required to file Form 1099-C with the IRS. The IRS treats the forgiven debt as income, and therefore you may owe income taxes.
However, it is my understanding that when a debt has been discharged in bankruptcy that debt does not need to be included as income for tax purposes.
If you file an IRS Form 982 to counteract this, you may be able to avoid payment by proving you’re insolvent at the time the debt was forgiven. It is my understanding that the IRS has specific guidelines and a Worksheet used to define "insolvency".
You can prove your insolvency by filing IRS Form 982 and attaching it to your federal income tax return to combat Form 1099-C. This shows that your debt was canceled during a bankruptcy case and is now excluded from taxable income. 
What if the debt is in an active Chapter 13 and the 1099 C was filed prior to Discharge? 
 You may want to check Line 1a on Form 982—but include an Attachment to the Form 982 that you file with the IRS that states that the debt has not yet been discharged—but it is included in a current Chapter 13 case.  It would also be recommended to provide the IRS with your current case number.  If you provide the IRS with ALL the information, I assume that they will notify you if you are mistaken.
**** Note: You should seek the advice of an accountant, as this is not legal advice regarding taxes.