YOU MUST UNDERSTAND CRYPTOCURRENCY IF YOU DIVORCE

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Cryptocurrencies are here to stay so you might as well learn about them. If you’re married, it could be financially beneficial to understand any involvement your spouse, with or without you, might have with this new financial asset class.

WHY YOU SHOULD CARE ABOUT CRYPTOCURRENCY

Why should you care about cryptocurrency like Bitcoin? Because cryptocurrency can be very valuable community property and hidden from you when it’s time for you to divorce and divide your community assets.

What is cryptocurrency? Cryptocurrency is a digital cash system without a central authority. It is a decentralized system. Cryptocurrency is digital currency.

In 2018 this relatively new digital cash system known as the cryptocurrency market is expected to reach a total value of $1 trillion. According to data from businessinsider.com, the market cap of all cryptocurrencies stood at over $700 billion on January 3rd of this year.

Bitcoin is the leader of all cryptocurrencies. It is based on a blockchain. Blockchain is considered a technology that is changing the way people transact business. Blockchain technology allows us to make transactions without any central review body.

Bitcoin currently has the top cryptocurrency market cap at $140,905,000,000. That’s more than a hundred and forty billion dollars in Bitcoin alone. At the time of this writing, the price of one Bitcoin is $8,269.48.

Roger Ver, CEO at Bitcoin.com, calls Bitcoin technology one of the most important inventions in all of human history. “For the first time ever, anyone can send or receive any amount of money with anyone else, anywhere on the planet, conveniently and without restriction,” Ver says. “It’s the dawn of a better free world.”

It’s the dawn of a better free world if you know where all the community Bitcoin and other cryptocurrency your spouse bought are. But, you know, sometimes they get lost. Other times they get hidden out of plain view, which means you don’t know about them.

TRACING CRYPTOCURRENCY

There’s a lot of money out there in a lot of cryptos – at least $700 billion worth – and some of it might be yours. Cryptocurrency can be held in any number of ways. It can be held in virtual wallets and offline wallets. Your best friend can be holding the profits derived from his Lite Coin purchases in his girlfriend’s aunt’s maid’s name. Your spouse could be holding her Ethereum cryptocurrency stash overseas in a business partner’s name – a business partner you’ve never even heard of.

Bitcoin has been defined as, “A Peer-to-Peer Electronic Cash System.” It is considered a cryptocurrency because users can pseudnonymously transfer money directly to one another, peer to peer, without the use of a middleman like a bank, governmental authority, or Western Union. It’s called pseudononymously because users are assigned a string of numbers as their Bitcoin wallet address where they store their Bitcoins.

The problem in family law is that divorces become contentious and spouses sometimes don’t want to play by the rules — instead choosing to hide assets from their spouse that might otherwise be subject to equitable division in a marital settlement agreement.

Any specialist in family law you hire in divorce should routinely request discovery as to all cryptocurrencies that your spouse, and thus the community, might have an ownership interest in, whether you are aware of any being purchased during your marriage or not. If your spouse has suffered what he or she calls large gambling losses, or large amounts of money are found missing from community accounts, you’re going to want a forensic accounting to locate all suspected missing community assets.

Cryptocurrency can be traced back to a single spouse’s separate property just like any other tracing of a community property asset. It’s just that some assets are more difficult to trace than are others.

There are forensic analysts who specialize in tracking cryptocurrency and they can work to connect Bitcoin wallet addresses, for example, with the users’ actual identities. If large amounts of money are being transferred to a cryptocurrency exchange where cryptocurrencies are being purchased, this must be financially accounted for as well.

Same thing for the discovery of large cash withdrawals or transfers that were used to purchase cryptocurrency at peer-to-peer points of sale like localbitcoins.com. If it can’t be determined where that cash went, and your spouse doesn’t produce evidence re what he or she was doing with that cash, you will want an accounting thereof that leads to an equitable division of the community assets that were lost to you due to your spouse’s unauthorized withdrawals that led to the dissipation of community assets.

BOTTOM LINE IS TO SEARCH THEN SEIZE

Once you find the missing monies invested in hidden places, you have to get them out. That’s your family law specialist’s job, and that’s not always automatic. You might need passwords, usernames, and mnemonic seeds. If your spouse has played in the cryptocurrency market without you, it is possible your spouse has hidden a cache of profits derived from cryptocurrency business transactions in accounts under pseudonyms, other persons or business names, or they could have been transferred abroad.

If your divorce specialist has to go to court in an effort to retrieve hidden assets, your attorney will need to make a clear showing of how the money was transferred from a bank account or from some other community property asset to purchase the community cryptocurrency assets in dispute. When you hire a specialist in family law they can move the court for orders to exert pressure on your spouse to give up control over the hidden cryptocurrencies, and if that is not honored, the court can order an unbalanced division of community assets that will account for your share of the missing cryptocurrency.

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PRESIDENT TRUMP’S DECEMBER 2017 TAX PLAN ELIMINATES DEDUCTIONS FOR ALIMONY PAYMENTS

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The burden of paying spousal support is about to reverse.  That’s because there’s a new tax law called, Tax Cuts and Jobs Act (TCJA), that was passed by Congress in December 2017, that has effectively abolished tax deductions on alimony payments beginning January 1, 2019.  Under the new Tax Cuts and Jobs Act, alimony payments will be neither tax deductible for the paying spouse nor taxable in the hands of the recipient spouse.

This new law will apply to payments that are required under divorce or separation instruments that are:

(1) executed after December 31, 2018, or,

(2) modified after that date if the modification specifically states that the TCJA treatments of spousal support payments (not deductible by the payor and not taxable income tax by the recipient) applies forthwith.

This new alimony provision is not retroactive, and it does not apply to divorces and separation orders entered into before 2019.

Until this new law, paying spousal support could be considered a “win-win” situation for both divorcing spouses.  The payor receives the benefit of a reduced tax obligation and the payee receives the benefit of more income than might otherwise be forthcoming if the payor spouse wasn’t receiving the benefit of the tax deduction.

This change in law could now prove expensive for individuals who must pay spousal support, because the tax savings normally derived from deducting spousal support payments can be substantial for high-earners.  One of the biggest disadvantages of the new tax law is that it could affect the desire of a higher-earning spouse to settle with their dependent spouse, since the deduction acts as a great motivator for the higher wage earner to agree to help support the spouse with less income in the first place.

WINDOW IS STILL OPEN

There is still a window for the payor to receive deductions for spousal support payments, but that window is closing.  If you are involved in divorce proceedings, or you are thinking about divorcing, and you want deductible spousal support treatment for some or all of the payments that you will make to your soon-to-be-ex, the TCJA gives you a huge incentive to get your divorce agreement wrapped up and signed by December 31, 2018.

On the other hand, if you anticipate being the recipient of spousal support, you have a big incentive to put off finalizing your agreement until next year, because the payments will become tax-free to you.

Either way, you should contact a specialist in family law, someone who is experienced in divorce tax issues, to get the best tax results for yourself.  Tax-wise, waiting too long could turn out to be an expensive mistake for years to come.

Lastly, be warned that many otherwise competent divorce lawyers are not up to speed on many of the new tax changes.  So don’t assume that just any family law attorney is capable of guiding you to the best tax results in your divorce.  Do your homework.  Contact a specialist in family law who is up to date on the latest tax changes that might affect you.  Find out who can best represent you regarding your spousal support requirements, and other family law-related issues.

PRESIDENT TRUMP’S DECEMBER 2017 TAX PLAN ELIMINATES DEDUCTIONS FOR ALIMONY PAYMENTS

Leave a comment

The burden of paying spousal support is about to reverse. That’s because there’s a new tax law called, Tax Cuts and Jobs Act (TCJA), that was passed by Congress in December 2017, that has effectively abolished tax deductions on alimony payments beginning January 1, 2019. Under the new Tax Cuts and Jobs Act, alimony payments will be neither tax deductible for the paying spouse nor taxable in the hands of the recipient spouse.

This new law will apply to payments that are required under divorce or separation instruments that are:

(1) executed after December 31, 2018, or,

(2) modified after that date if the modification specifically states that the TCJA treatments of spousal support payments (not deductible by the payor and not taxable income tax by the recipient) applies forthwith.

This new alimony provision is not retroactive, and it does not apply to divorces and separation orders entered into before 2019.

Until this new law, paying spousal support could be considered a “win-win” situation for both divorcing spouses. The payor receives the benefit of a reduced tax obligation and the payee receives the benefit of more income than might otherwise be forthcoming if the payor spouse wasn’t receiving the benefit of the tax deduction.

This change in law could now prove expensive for individuals who must pay spousal support, because the tax savings normally derived from deducting spousal support payments can be substantial for high-earners. One of the biggest disadvantages of the new tax law is that it could affect the desire of a higher-earning spouse to settle with their dependent spouse, since the deduction acts as a great motivator for the higher wage earner to agree to help support the spouse with less income in the first place.

WINDOW IS STILL OPEN

There is still a window for the payor to receive deductions for spousal support payments, but that window is closing. If you are involved in divorce proceedings, or you are thinking about divorcing, and you want deductible spousal support treatment for some or all of the payments that you will make to your soon-to-be-ex, the TCJA gives you a huge incentive to get your divorce agreement wrapped up and signed by December 31, 2018.

On the other hand, if you anticipate being the recipient of spousal support, you have a big incentive to put off finalizing your agreement until next year, because the payments will become tax-free to you.

Either way, you should contact a specialist in family law, someone who is experienced in divorce tax issues, to get the best tax results for yourself. Tax-wise, waiting too long could turn out to be an expensive mistake for years to come.

Lastly, be warned that many otherwise competent divorce lawyers are not up to speed on many of the new tax changes. So don’t assume that just any family law attorney is capable of guiding you to the best tax results in your divorce. Do your homework. Contact a specialist in family law who is up to date on the latest tax changes that might affect you. Find out who can best represent you regarding your spousal support requirements, and other family law-related issues.

THERE WAS A MAJOR GOLD RESET BUT NOBODY IS TALKING ABOUT IT IN FAMILY LAW — UNTIL NOW

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Is the American financial system really crashing?  And if so, what are the indicators we should be looking for?  ITM Trading’s Chief Marketing Analyst Lynette Zang says we’ve been getting signals of a crash for quite some time now.

The former stockbroker and investment banker says she’s been referencing what she calls “pattern shifts” that have been speeding up since October of 2017.  She notes that “insiders”, heads of corporations like boards of directors and CEOs, have been “running for the exits” financially.

Zang also notes how global Central Banks, “not in this country, and not in Canada, but everywhere else,” are massively accumulating gold.  Why are they doing this?  Why are some of the world’s biggest banks and corporate heads “massively accumulating gold”?  Could it be that the gold hordes will be utilized toward a coordinated backing of those nations’ currencies?

Zang says it only makes financial sense.  “Because gold is a savings based currency,” the chief marketing analyst says.  Zang believes other countries are accumulating gold in record numbers in preparation for the reset of the debt.  If we’re a family, for instance, and we have a financial crisis, we can bail ourselves out of trouble through our savings.  Theoretically, we can throw money at it and get out of that crisis.  That’s one reason savings are so critical to our families’ survival.  But if we have no savings when that next crisis hits, how do we get out it?

Same thing with nations.  And if you’re a huge government like the United States, and you seemingly have no savings, just a bunch of intertwined bureaucracies trying to take the thin margin of profit from one another, what are you going to do when there’s no margin left to loot?  Where’s the money going to come from?  Where as individuals are we going to get our family’s financial security from?  Lynette Zang says that’s when it’s time to start a new financial system.

COME ON.  A NEW FINANCIAL SYSTEM?

Zang says that the reason a country should have major amounts of gold in its reserves is because, from a national perspective, gold creates fiscal responsibility.  That’s why all the other countries are buying it up in record numbers.

Now as far as the reset is concerned, it is about resetting the debt.  Zang says that if the financial reset is on a global scale, which she believes it is, because all the countries are in major financial debt, then the countries with the gold are going to be the ones with the savings.  They’re the ones who are going to be able to do the business, because they have savings.  The United States is not one of those countries.  That’s how the wealth is going to be transferred.

THATS HOW THE WEALTH IS GOING TO BE TRANSFERRED?

That’s how the American dollar has gone.  In the beginning, it was 100% backed by gold.  Then it was 25% backed.  We were taken off of that during the Nixon administration in 1971.  If having gold is a sign of fiscal responsibility, America’s dire financial condition is a sign of our lack of fiscal responsibility.

Zang believes that we who populate the United States will ultimately end up with Venezuela style hyperinflation.  If you don’t know what that means, look it up.  A good majority of the citizens in Venezuela operate from below the poverty line.  Economists say we’re going to suffer a similar fate.  Our standard of living is going to shift dramatically.  Globally on average about 80% of the population ends up in abject poverty.  In Venezuela that number is ninety percent.

Venezuela did a formal reset of their currency to gold on February 9th of this year.  The price of gold went up that day.

When the system crashes it’s not like you’re going to take your gold and silver and bury it in the back yard.   What you want to do is be prepared.  Think about your standard of living, and do what you can do to sustain that.  Food, water, energy, security, community, and silver and gold as barter.  Small denominations to be used for a tank of gas or to go to the grocery store and purchase blueberries.

During a financial crisis like Venezuela has faced, gold or silver may not pay you interest, but it is the safest thing you can do currency wise.  Zang also says you want a certain amount of cash out of the banks, because we’re not going to be given notice when the bank is going to shut down, or we’re not going to be able to get access to the financial system.  The more digital the financial system becomes, the more important cash will become.

Zang refers to 1996 when the National Security Agency white paper on cryptocurrencies came out which referenced cryptos as being outside the system.  “They are private,” she says.  “They’re invisible.”  You can have them in a wallet.  Zang believes this might be stretching the true intentions of the coming financial system, but she can’t be sure.  She wonders whether by telling us cryptocurrencies are outside the system, that they really mean that cryptos are “the system” the globalist controlling Banksters want us to adopt.

Other sources have alluded to the concept that in the U.S. there’s going to be a gold-backed cryptocurrency that will replace the U.S. dollar as our national currency.  In either scenario, it sounds like we’d better practice up on our digital cryptocurrency skills.  And save some gold and silver buried under a tree.  And read up on Venezuela-style hyperinflation and what it’ll take to survive it.