Client pays taxes in two states
If one of the parties files a nonresident return for a second state, there typically is no adjustment you need to make. This is because the resident state typically allows a credit for the tax paid to the nonresident state, limited to the amount of tax that would apply to that income in the resident […]
How do I handle depreciation recapture?
If a real estate property was rented or used for business, and then is sold, there may be depreciation recapture on the rented portion. Depreciation recapture provides that some of the gain on a sale of real estate is ordinary income. It applies if a method other than straight line was used to depreciate the […]
How do I enter responsibility for the mortgage shifting from one party to the other?
Here is how to specify that Party A is taking the mortgage over from Party B after, for example, four years: 1. Set Party B as initially paying the mortgage. 2. On the “more info” screen for the mortgage, specify that Party B will make a balloon payment in the amount of the balance at […]
How do I enter rent for a party who is paying rent?
You can enter it where you enter expenses. There will be a Real Estate section, and you will see a button to enter “Tenant expenses.”
How can I handle a net operating loss carryforward?
A net operating loss carryforward is an anticipated tax deduction in excess of regular taxes calculated by Family Law Software. If you want to focus on the income aspect, you can override the “Other income” line on View/Edit Taxes for each year in which the loss will be carried forward. Enter the amount of the […]
How do I show a retirement from a business, or sale of a business?
Go to the “more info” screen for the business. You will see a question about whether the business owner will retire or the business will be sold. the question is worded this way so it can cover both retirement and sale. This is where you enter a sale or retirement date. If the business has […]
How do I compute the child support guideline amount?
Enter the information relating to child support on the Enter Data tab, on the screen for child support there. View and print the child support guideline worksheet on that tab, on the screen to print child support. The software can calculate child support for twenty-two states: California, Connecticut, Colorado, Florida, Georgia, Illinois, Massachusetts, Maryland, Michigan, […]
How can I handle the reimbursement (equalization) in a situation in which the wife has given separate property to the husband (or vice versa)?
Just specify that the separate property is given to the other party. Then the situation is automatically reflected on the Marital Property Division screen. Let us illustrate in a case that has only one asset. It is a real estate property worth $500,000 (no mortgage, for simplicity), in which the wife has a $100,000 separate […]
How can I calculate Family Support?
“Family Support” is a calculation that is popular in California. It follows a California statute that allows people to designate payments from one spouse to another as “Family Support,” meaning an undifferentiated combination of child and spousal support. The hope is that this all will be taxed as spousal support, but that may not happen. […]
How can I calculate child support modifications if there is split custody (each parent is custodial for one or more children)?
Here are the steps to take: 1. Save the file under a different name. This will be a “what if” file. 2. In this file, indicate that the oldest child is not of an age to be eligible for child support, by clearing the “Eligible Age” box on the line for that child. 3. See […]