Wednesday, December 1, 2021

Ponzi Schemes and the Theft Loss Deduction

Every few months or so seem to bring new revelations of a Ponzi scheme gone bust.[1] In the aftermath, erstwhile investors often struggle to be made whole again. Fortunately, the federal income tax offers options to help, although none are perfect.

Under the federal income tax, individuals currently have two ways to claim a deduction for losses due to Ponzi schemes: 1) follow the general rules for deducting theft losses under I.R.C. § 165 (which can be unduly burdensome), or 2) follow the “safe-harbor” under Revenue Procedure 2009-20 (which sets limitations on the deductible amounts of such losses).

I.RC. § 165, Generally

I.R.C. § 165 generally allows individuals to deduct losses not otherwise compensated for that are sustained during the taxable year in any transaction entered into for profit.[i] See I.R.C. § 165(a), (c)(2). This includes losses due to theft. See Treas. Reg. § 1.165-8(a)(1).

For federal income tax purposes, theft has a “general and broad connotation and includes any criminal appropriation of another’s property . . . .” Evensen v. Comm’r, T.C. Memo 2018-141 (citing Edwards v. Bromberg, 232 F.2d 107, 110 (5th Cir. 1956)). Still, a taxpayer claiming a theft loss deduction must demonstrate that there was a taking of property with criminal intent that was illegal under the law of the jurisdiction in which the taking occurred. See, e.g., Rev. Rul. 72-112. The taxpayer also must establish the amount of the loss, the year in which the taxpayer discovered the loss, and that there is no reasonable prospect of recovery in that year. See Treas. Reg. §§ 1.165-1(d), 1.165-8(a)(2).

Establishing these elements can be difficult. For instance, proving that a taking was illegal within a particular jurisdiction and that it was done with criminal intent often puts the taxpayer in the position of a prosecutor, only without the state’s investigative resources. For Ponzi schemes, especially, establishing when the taxpayer discovered that a theft has occurred can be problematic, since it is the nature such schemes to appear to be a legitimate investment opportunity. It also may be unclear at any given point whether there is a reasonable prospect of recovery. There may even be some question as to which jurisdiction’s law governs whether a taking is theft when the taking involves conduct in more than one state or country. See Giunta v. Comm’r, T.C. Memo 2018-180 (providing as a basis for rejecting a taxpayer’s theft loss deduction that the taxpayer had not proven which jurisdiction’s law would govern the “theft” inquiry).

Revenue Procedure 2009-20

Given the difficulty of establishing a theft loss deduction generally under I.R.C. § 165, the IRS has provided an optional safe-harbor for certain good faith investors claiming a deduction for losses arising from Ponzi-type schemes in which some specified legal action has been taken against the lead figure of the scheme. If a taxpayer meets the requirements of the safe harbor, the IRS will not challenge the taxpayer’s claim of a theft loss deduction in connection with such a scheme.

Revenue Procedure 2009-20, which first announced the safe harbor, speaks in terms of “specified fraudulent arrangements,” “qualified losses,” and “qualified investors.”

According to the Revenue Procedure, a “specified fraudulent arrangement” is “an arrangement in which a party (the lead figure) receives cash or property from investors; purports to earn income for the investors; reports income amounts to the investors that are partially or wholly fictitious; makes payments, if any, of purported income or principal to some investors from amounts that other investors invested in the fraudulent arrangement; and appropriates some or all of the investors’ cash or property.”

A “qualified loss,” on the other hand, is defined with respect to some legal action that the government has taken with respect to a lead figure. Thus, a “qualified loss” is a loss arising from a specified fraudulent arrangement in which:

a lead figure was charged by indictment or information under state or federal law with a crime in connection with the arrangement that, if proven, would amount to theft for federal income tax purposes under the law of the jurisdiction in which the theft occurred, and the indictment or complaint has not been withdrawn or dismissed other than because of the lead figure’s death;
a lead figure was the subject of a state or federal criminal complaint alleging theft, such complaint has not been withdrawn or dismissed other than because of the lead figure’s death, and either: (i) the complaint alleges the lead figure’s admission or execution of an affidavit admitting to the crime, or (ii) a receiver or trustee was appointed with respect to the arrangement, or the assets of the arrangement were frozen; or
a lead figure, or an associated entity involved in the specified fraudulent arrangement, was the subject of a civil complaint or similar document that a state or the federal government has filed with a court or in an administrative agency enforcement proceeding, and (i) the civil complaint or similar document alleges facts that comprise substantially all of the elements of a specified fraudulent arrangement conducted by the lead figure; (ii) the lead figure’s death prevents an indictment, information, or criminal complaint from being filed against the lead figure; and (iii) a receiver or trustee was appointed with respect to the arrangement or assets of the arrangement were frozen.

See id. (as modified by Rev Prov. 2011-58).

A “qualified investor” is a U.S. person that (1) generally qualifies to deduct theft losses, (2) did not have actual knowledge that the investment arrangement was fraudulent before it became publicly known, (3) did not use the specified fraudulent arrangement as a tax shelter, and (4) transferred cash or property to the specified fraudulent arrangement. Id.

Revenue Procedure 2009-20 states that the IRS will not challenge a qualified investor’s theft loss deduction for a qualified loss in the taxable year in which the indictment, information, or complaint against a lead figure was filed, if the amount of the deduction meets certain limitations. Id. In other words, the Revenue Procedure uses the state or federal government’s action in bringing criminal charges against a lead figure as a proxy for the taxpayer’s discovery of the theft.

The amount of theft loss deduction that the IRS will allow under the Revenue Procedure 2009-20 is determined by multiplying the amount of the investor’s qualified investment by 95% (for a qualified that does not pursue potential third-party recovery) or 75% (for a qualified investor that is pursuing or intends to pursue potential third-party recovery), and then subtracting the sum of an any actual recovery and claims for reimbursement for the qualified loss that are attributable to insurance policies, contractual arrangements, or amounts payable from the Securities Investor Protection Corporation. Id. In this context, a “qualified investment” means the total cash or basis of property that the qualified investor invested in the arrangement plus the total net income with respect to the fraudulent arrangement that the qualified investor included as income for federal tax purposes, minus the total amount of cash or property that the qualified investor withdrew from the specified fraudulent arrangement. Id. A qualified investor may have income in a future year depending on the actual amount of the loss that is recovered. Id.

Procedurally, a taxpayer claiming the safe harbor under Revenue Procedure 2009-20 must write “Revenue Procedure 2009-20” at the top of the Form 4684 for the federal tax return for the discovery year and complete and sign a statement that will be attached with the return.

Observations

While the safe harbor in Revenue Procedure 2009-20 provides more certainty and mitigates some of the harshness that taxpayers face in claiming a theft loss deduction generally under I.R.C. § 165, it is hardly perfect. Taxpayers left reeling in the aftermath of a Ponzi scheme should consult with tax counsel to figure out possible options for being made as close to whole again as possible.

[1] As the FBI explains:

“Ponzi” schemes promise high financial returns or dividends not available through traditional investments. Instead of investing the funds of victims, however, the con artist pays “dividends” to initial investors using the funds of subsequent investors. The scheme generally falls apart when the operator flees with all of the proceeds or when a sufficient number of new investors cannot be found to allow the continued payment of “dividends.”

https://www.fbi.gov/scams-and-safety/common-scams-and-crimes/ponzi-schemes.

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World AIDS Day: 40 Years of Progress

This June, the world marked 40 years since the first cases of what later became known as AIDS were officially reported. In the summer of 1981, five previously healthy men in Los Angeles presented with cases of a rare lung disease and other unusual infections, suggesting immune system weakness. A cluster of similar cases in New York and elsewhere in California were documented shortly thereafter. Fast forward to 2021: The Department of Health and Human Services released its National Strategic Plan to end the epidemic in the United States. Over the course of 40 years, additional government agencies and global public health bodies, including the National Institutes of Health, the Centers for Disease Control, and the World Health Organization, launched their own research and investigations into the causes, control, and cure for the virus that causes AIDS.

To commemorate the 40th anniversary of the release of the CDC Morbidity and Mortality Weekly Report (MMWR) that first documented what later become known as the AIDS epidemic and to observe World AIDS Day, the American Bar Association (ABA) will present HIV/AIDS at 40: Perspectives on the Struggle. This free, non-CLE webinar will take place on December 1, 2021, at 3:00pm CST and will offer “a retrospective on the legal, social, and medical struggles and successes associated with HIV/AIDS over the last 40 years.”

The ABA also offers an HIV/AIDS Webinar Series “to identify and address legal policy issues affecting or affected by the epidemic domestically and internationally, with a view to ensuring the rights of all concerned are respected and protected.”

HIV and AIDS Legal Resources

The Center for HIV Law & Policy: CHLP fights stigma and discrimination at the intersection of HIV, race, health status, disability, class, sexuality, and gender identity and expression, with a focus on criminal and public health systems.
HIV Criminalization in the United States: TEXAS: For detail on Texas statutes and case law, read this except from the CHLP’s compendium of HIV- and STI-related criminal law and civil laws relating to public health control measures.
Vivent Health: Legal Services: Vivent Health provides access to a team of attorneys who can help people living with HIV who have experienced discrimination in employment, housing, health care, health insurance, or government assistance such as SSI. Additional services include estate planning, landlord and tenant dispute resolution, and preparation of advance directives.
Legal Hospice of Texas: Since 1989, Legal Hospice of Texas has been providing timely and compassionate legal services, at no cost, to low income individuals with terminal illnesses or HIV disease. Services provided include estate planning, debt counseling, social security counseling and appeals, health insurance navigation, employment discrimination, and landlord/tenant dispute resolution.

Past, Present, and Future

CDC Museum: Reflections on 40 Years of HIV: This exhibition explores the CDC’s early response to the HIV epidemic from the earliest CDC investigation to the implementation of prevention strategies, including HIV testing and targeted public health messaging, as well as guidelines for teaching tolerance and compassion for people who are HIV positive.
National Institutes of Health: Reflect, Recommit, Reenergize, Reengage – Four for Forty: On June 5th, the National Institutes of Health (NIH) Office of AIDS Research (OAR) joined colleagues around the world to commemorate the 40th anniversary of the landmark CDC Morbidity and Mortality Weekly Report (MMWR) that first recognized the syndrome of diseases later named AIDS. OAR has conducted a communications campaign that will continue through NIH’s World AIDS Day on December 1, 2021, to recognize the milestones achieved through science and pay tribute to more than 32 million people who have died from AIDS-related illness globally (including 700,000 Americans), and support the goal of Ending the HIV Epidemic in the U.S. (EHE) and worldwide.
The U.S. President’s Emergency Plan for AIDS Relief (PEPFAR): The Office of the U.S. Global AIDS Coordinator and Global Health Diplomacy leads, manages, and oversees the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR). Through PEPFAR, the U.S. government has invested over $85 billion in the global HIV/AIDS response, the largest commitment by any nation to address a single disease in history, saving over 20 million lives, preventing millions of HIV infections, and accelerating progress toward controlling the global HIV/AIDS epidemic in more than 50 countries.

Timelines

A Timeline of HIV and AIDS @ HIV.gov
National Prevention Information Network (CDC): HIV and AIDS Timeline
40 Years of AIDS: A Timeline of the Epidemic (University of California San Francisco)
Avert HIV Timeline
National Native HIV Network: A Journey Through the Native HIV/AIDS Timeline

AIDS Memorial Quilt

National AIDS Memorial: World AIDS Day Virtual National Observance – A Day of Impact & Hope
National AIDS Memorial Quilt — Interactive

HIV and COVID-19

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Non-Willful FBAR Penalties Will be Much Higher in the Fifth Circuit

Concept of decision or choice using a wooden boardwalk in dense forest in Great Dismal Swamp On November 30, 2021, the Fifth Circuit parted ways with the taxpayer friendly decision of the Ninth Circuit that non-willful penalties are capped at $10,000 per FBAR filing instead of the $10,000 per unreported bank account argued by the government. District courts in New Jersey, Connecticut, and Texas had all ruled in the taxpayer’s favor that non-willful penalties were capped at $10,000 per form. In United States v. Boyd, 991 F.3d 1077 (9th Cir. 2021), the Ninth circuit reversed the district court’s per-account determination and made the per-form cap the law within the 9^th Circuit. United States v. Bittner, No. 20-40597 (5th Circuit), was on appeal from a taxpayer friendly decision reducing the $2.7 Million dollar penalty to $50,000 based on a $10,000 per form cap on non-willful FBAR penalties. Although not guaranteed, it appeared that the momentum was in the taxpayer’s favor for an affirmance of the reduction. However, the Fifth Circuit reversed the favorable district court decision and held that the “$10,000 penalty cap therefore applies on a per-account, not a per-form basis.”

Taxpayer Jane Boyd was a U.S. citizen and had fourteen bank accounts in the United Kingdom that increased in value when she received an inheritance from her father’s death. Boyd failed to report the interest and dividends from these accounts on her 2010 income tax return. Boyd participated in the Offshore Voluntary Disclosure Program (OVDP) but opted out and was subject to a full examination by the IRS. The result of that examination was that Boyd, although non-willful, had committed thirteen violations for each account that should have been reported but wasn’t. The resulting penalty was $47,279.

Alexandru Bittner was a Romanian immigrant who naturalized in 1987 and returned to Romania in 1990 and became a successful businessman and investor. Bittner maintained dozens of bank accounts in Romania, Switzerland, and Liechtenstein. Although Bittner had accountants maintaining compliance with Romanian tax laws he argued that he was unaware that as a U.S. citizen he still had to report his interests in certain foreign accounts and never filed FBARs while living in Romania. When he returned to the United States in 2011 he hired a CPA who filed corrected FBARs in 2012 but only listed his largest account and didn’t list his interest in 25 or more qualifying accounts. Bittner hired a new CPA in 2013 who filed corrected FBARs listing all foreign bank account information and balances. The accounts for each unreported year was in excess of 50 separate accounts.

Both Boyd and Bittner argued that they committed only one non-willful violation, not multiple violations based on the number of accounts, and that the maximum penalty allowed by the statute was $10,000 for the failure to file the FBAR form each year. Boyd was unsuccessful at the district court level and that decision was reversed by the Ninth Circuit. Bittner was successful at the district court level and that decision is now reversed by the Fifth Circuit. The appeals saved one taxpayer and has destroyed the other taxpayer’s favorable result.

The government is allowed to impose a civil penalty on any person violating any provision of the Bank Secrecy Act (BSA) pursuant to 31 U.S.C. §5321(a). There are two types of penalties depending on whether the violation was willful or non-willful. See 31 U.S.C. §5321(a). The maximums for the penalty are also different depending on whether the violation was non-willful (capped at $10,000) or willful (capped at the greater of $100,000 or 50% of the balance in the account at the time of the violation). Non-willful violations also contain a provision preventing penalties if the violation was “due to reasonable cause” and “the amount of the transaction or the balance in the account at the time of the transaction was properly reported.” The non-willful penalty does not explicitly prevent multiple violations, but it doesn’t authorize it either and that is what appears to have caused the dispute. The government argued, in both cases, that the term “any” means multiple. The government also argued that, although bank accounts are only specifically mentioned in the willful penalty, Congress intended both penalties to be treated similarly. The taxpayers, in both cases, pointed to the fact that non-willful violations are dealt with separately and have separate requirements outlined in both the statute and the regulations. The Ninth Circuit presumed that Congress purposely excluded the per-account language from the non-willful portion. However, the Fifth Circuit determined that multiple violations can be implied from a reading of the whole statutory framework even if not specifically mentioned.

Further complicating the issue is that the per-account analysis can lead to a clearly strange result. An admittedly non-willful taxpayer can pay a larger penalty than a willful violator merely because of the number of accounts involved. This absurdity was raised in Bittner, but summarily dismissed by the Fifth Circuit as not absurd because of the government’s goal “to crack down on the use of foreign financial accounts to evade taxes.” However, the Fifth Circuit never addresses why a calculation system that can punish non-willful actions more severely than similar willful actions is not absurd or at least evidence that Congress deliberately left out the designation of number of accounts to prevent that result. Perhaps Bittner will seek further appeal to clarify this issue. However, for now, the decision creates a split in the circuits where taxpayers in the Ninth Circuit receive way more favorable treatment when facing non-willful FBAR penalties assessed by the government. Taxpayers have other defenses to FBAR penalties and will need to rely on those defenses until the decision is overturned or changed by subsequent cases.

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Opening Statements in a divorce trial

When it comes to courtroom experiences in a Texas divorce, I can think of no single event that is more complicated or stressful than a trial. For months and possibly longer than a year you have been submitting yourself to the process of a divorce case. This means you would have attended mediation, negotiated on your case informally with your spouse, shared custody of your children, and put the rest of your life on hold while you attended to this divorce. When mediation was unsuccessful at settling your case the only possible place to turn to complete your divorce was the inside of a courtroom. This probably was not the outcome you wanted out of your divorce, but it was the one that became your reality.

Like anything else in life, rather than ignore this reality you chose to deal with the consequences head-on. Learning about the different aspects of a trial would certainly make sense as far as the next steps in this process. No one is saying that you must go out and earn a law degree in terms of your preparation for this case but having a basic level of knowledge would be very helpful so you can know what to expect and prepare yourself for the challenges and opportunities that are a part of a divorce trial. If you have hired an attorney to represent you in this divorce, then he or she will be able to help you with much of the preparation involved in a trial.

It is not exactly the case that your attorney does all the work for you in a divorce. However, when it comes to divorce your Attorney will certainly play a vital role. Your job during this process is to be able to cooperate with your attorney when he or she needs information and to be accountable to him or her as far as telling the truth. Attorneys spend a great deal of time thinking about courtroom strategy and questions for direct and cross-examination. Your lawyer will want to make sure that the questions he or she asks will be helpful to your case. He or she also wants to know the answers to any questions that he or she asks beforehand. Therefore, if you provide information to your attorney, it is not accurate, he or she may make a mistake in questioning you or your spouse or any other witness. This could prove to be a major problem for your case and could greatly impact the result of the trial. All of the work you put forth into your case could be for nothing if you are not honest with your attorney during the preparation for a trial.

What to wear to court?

This is always an interesting subject to discuss with clients given the fact that attorneys are not always equipped to be able to give you fashion advice. The way that you are returning with dress in their private life may be quite different in the way you address and vice first period however, I think listening to the advice of your attorney when it comes to what to wear or what not to wear in court is important. The major reason is that or attorney has been to court before and you may not have. Therefore, taking your attorney’s advice when it comes to courtroom dress can be extremely important. That’s not to say that it’s among the most important topics of a trial, not by any means. However, getting it right in terms of what clothes you wear to court is something relatively easy for you to handle. You will want to rack up enough easy wins in your trial that the more difficult wins can be achieved.

The clothes you should wear to quart are probably very similar to the clothes you would wear to work, church, or Thanksgiving dinner. For men, a dress shirt tucked into slacks and dress shoes is completely appropriate. You are found to wear a suit if you have one and feel comfortable in a suit. However, you should not feel the need to dress beyond your financial resources or your comfort level. There is no prize awarded at the end of a divorce case for the spouses who are best dressed. Gentlemen: where something that looks presentable but there is no need to spend a lot of money on your outfit.

For women, my advice would be to wear clothing that is more conservative than fashionable. This means that tight-fitting clothing, short dresses, or revealing outfits should not be worn in court. Additionally, you should not wear any perfumes or jewelry that are distracting. Anything that would take the judge’s attention away from your case and put it on what you were wearing would not be a wise decision. You want the focus of your case to be on the subject matter at hand rather than any kind of fashion statement that you are making or not making.

If you have specific questions about how to conduct yourself in court, then your best bet would be to talk with your attorney specifically. Your lawyer may have particular pieces of advice to offer in terms of behavior for the courtroom or specific conduct that could be detrimental or beneficial to your case. Otherwise, I think this basic advice will suit you and your family quite well. Wearing your Clothes that are unwrinkled, clean, and presentable is a much better plan than going out and spending a lot of money that you don’t necessarily have unclothing that you will only be wearing a few times.

These are the basic expectations as far as dressed in the courtroom. I understand that the courtroom is not the place that you feel most comfortable. It is likely also a place that you would rather not be. With that said, sometimes going to court to resolve a divorce is necessary. Remember that hiring an experienced family law attorney to help you in your divorce is probably the best advantage that you can provide yourself with for the entire case. Not every attorney is well suited to serve you in vice versa. With that said, you need to interview as many attorneys as you can to learn what qualities you want in a lawyer. The more diligent you are about research the better equipped you will be when it comes to planning your case.

What divorce is and what the opening statement of a divorce trial has to do with the marriage

Marriage occurs when two people agree to combine their lives and become one. When you and your spouse agreed to become married this was your acknowledgment that each of you was better off with one another than by yourselves. As such, you set aside your past and stepped into a life of shared values in time. Now as complicated as marriage can be a divorce trial can be just as complicated. The reason is that to untangle a complicated marriage you likely will have to have a complicated divorce trial. It can be extremely difficult to have your entire life analyzed by a judge and picked apart by two lawyers. However, this is what you signed up for the one you filed for divorce. The possibility that a trial may be necessary to end your case.

Many times, a divorce case can come to an end with mediation. In mediation, you and your spouse agreed to utilize a third-party mediator to help you all conclude in your case. This is one of the most difficult parts of a divorce. The assumption that your case could settle outside of court may be Torn to shreds very early in your case when you realize that A trial is going to be your only option when it comes to resolving the case. While this may be frustrating it is not something that you always have control over.

Whether or not you ever considered the possibility that the divorce court may come into your life the reality is that you can go to court on matters related to your life and marriage. A divorce trial has many elements some of which are not necessary to discuss in a blog like ours. Without getting trapped in the nitty-gritty have a divorce trial I think it is helpful for you to be able to learn more about the basic elements of a divorce so that you can better prepare for The realities better case presents for you and your family.

Breaking down the opening statement in a Texas divorce trial

The opening statement in a Texas divorce trial will lay out for the judge what the major issues in your case will be. An opening statement provided by attorneys is not evidence. Attorneys are not under oath and are not testifying When making those statements. there are certain things that your attorney will want to make sure that the judge understands about your case. An opening statement is a convenient and sensible place to begin that discussion. Typically, opening statements are an opportunity for the lawyer to directly address either a judge or jury. The opposing attorney will typically not object to or interject to an opening statement from the opposing lawyer. Therefore, this presents a unique opportunity for the lawyer to directly address the judge.

Do not expect your attorney to immediately begin to make arguments or assert certain positions. Rather, the opening statement is more about setting a tone and presenting a statement of facts rather than speaking persuasively. Some clients expressed frustration or confusion about why their attorney does not speak differently within the contacts dove the opening statement. However, once you understand that the opening statement is not intended to encapsulate arguments you will understand much better what your attorney is trying to accomplish.

Another important thing to note at this stage is that a divorce trial involves only the issues that you are not able to settle with your spouse in mediation or informal settlement negotiations. It is possible for you two to have settled almost every issue involved in your case and to only need to go to trial on one or two subjects. this would be a much preferable and much shorter trial than if you are unable to settle any aspect of your case. working to diminish the time, money, and effort necessary in a trial ahead of time is the wise decision to make.

opening statements are important to the outcome of your trial but not overly so. Opening statements matter in terms of an overall feel for your case rather than purely on a substantive level. Your attorney will want you to come across as the more reasonable, rational, and professional of the two participants in the case. The judge will have an opportunity to analyze a countless number of facts and arguments in the other parts of your trial period however, the opening statement operates as more of a tone-setter than as a means of conveying evidence or doing anything substantive.

you may have heard about how an opening statement is intended to humanize or make a person seem more approachable or likable. In many ways, this matters more for trials that are in front of juries than in front of judges. I think this is the case because juries are usually more persuaded or persuadable regarding subjects like this do too they are relatively inexperienced in trials. Being presented with information and arguments in a divorce trial is a new experience for many people who will be serving on a jury.

Finally, what your attorney may want to do with an opening statement in your case is to present to the judge any unique circumstances that may be relevant to your case. Sometimes You may have a situation where you are going to need to discuss the sensitive subject matter for yourself or your spouse. Therefore, rather than catch the judge off guard during a trial you may want to begin to introduce this information in the opening statement. This gives you a chance to make sure the judge understands a basic amount of information from your perspective during the outside of a case rather than relying upon Turning to do so during the actual evidentiary part of the trial.

Note how your attorney will do their best to be as polite and respectful towards the judge as possible. Your lawyer will need to balance the need to catch the attention of the judge with not being able to make arguments or present evidentiary circumstances. Helping the judge to your case from her POV remove yes is the most important part of your attorney’s job. A judge may be accustomed to looking at a particular issue from a certain vantage point. However, if he or she can Have their thinking changed or adjusted due to an effective opening statement then your lawyer will have done his or her job.

Preparing for a trial

The opening statement of your divorce trial will likely be the beginning of a stressful period of your life. To be able to go through a divorce trial successfully means that you must consider what year’s ultimate goals are for the case and how you all want to accomplish them. This is done through meticulous planning before the divorce. You should be prepared to work with your attorney in advance of a trial so that you can present your case in the best possible fashion. It is best understood that if you are not preparing for your trial then almost certainly your spouse is.

When we Talk about going through a divorce trial it is important to note that A trial will likely be the most expensive part of your case. The amount of time and preparation that goes into a trial or almost certainly goes beyond the preparation for all parts of your case up to that point. However, this should not dissuade you from going through with a trial if it is the only way 2 conclude your case. Sometimes it is not possible to resolve your case in mediation or through negotiation. With that said, however, the family courts can hear your case and render a decision.

Therefore, working alongside your attorney to get ready for a trial is a good investment in completing this stage of your life and being able to move on to your life post-divorce. With as many options as there are in choosing a divorce attorney, your best bet is to begin interviewing lawyers before filing for divorce. The time we spend being able to learn more about attorneys at this stage in the case could greatly benefit you down the line even as you prepare for a contested trial.

Questions about the material in today’s blog post? Contact the Law Office of Bryan Fagan

If you have any questions about the material in today’s blog post, please do not hesitate to contact the Law Office of Bryan Fagan. Our licensed family law attorneys offer free of charge consultations six days a week in person, over the phone, and via video. These consultations are a great way for you to learn more about the world of Texas family law as well as about how your family’s circumstances may be impacted by the filing of a divorce or child custody case.

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Keith Nelson Talks Courtroom Frustrations in Divorce Cases with D Magazine

ONDA partner Keith Nelson is extensively quoted in this year’s Family Law issue of D Magazine. In “Mediate or Litigate?” he discusses factors that may convince spouses to steer their divorce away from the courtroom.

“An increasing concern in family law courts is the strict time limits imposed by some judges,” Keith said. “Many have a template where each side may only be allowed 20 minutes at a temporary hearing to prove a major issue, like why our client should be awarded custody. We may have mental health professionals, special facts witnesses, and the parents themselves ready to testify, but there is no way to adequately present all of this to a judge in such a short time. Then, in some courts, even in complex family law litigation, each side may only be allowed two to three hours to present their case during final trial. This can be very challenging, and often impossible, in high-conflict cases that have a lot special issues to consider. The result is often that the court’s ruling doesn’t mirror the facts.”

Later, Keith cautions that there remain issues which can hinder a successful mediation:

“While the vast majority of family law cases ultimately settle at mediation, the timing of mediation can be a critical factor in whether the case settles or not,” Keith said. “If a case is mediated too quickly before the facts are sufficiently developed, then one side or the other may feel they have an edge. Conversely, if a case is sent to mediation too late, such as on the eve of trial, one or both parties may feel they have invested so much time and money by that point that they become entrenched and decide they might as well go to court. Both of those scenarios can increase the odds for a failed mediation.”

Despite these issues, however, Keith says circumstances are such that many prefer going the mediation route and resolving their divorce as quickly as possible.

“Some divorcing couples with complex issues that require the court’s attention are throwing up their hands in frustration because it can be too difficult to move the ball and get a case to court. Mediation is an increasingly popular choice for couples who want a more expedient path to final resolution.”

The Family Law issue of D Magazine is on sale and can be purchased now.

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What role does guilt play in a divorce?

Whether you wanted to go through a divorce or not, you may feel guilty because the marriage you imagined did not go as planned. Divorces tend to bring on many negative emotions, so both you and your spouse may be feeling bad about what’s happening.

Even though you know that a divorce is the right option for you, guilt could impact the way you handle it. That’s why it’s important to try to separate your feelings from the transactions involved in separating your property or lives.

Feeling guilt is normal as you move on from your marriage

When divorcing, it is normal to feel guilt over the end of your relationship. You may feel upset about ending your marriage or guilty that you weren’t able to hold it together for your children or spouse’s benefit.

It is normal to feel this way, but don’t let guilt influence how you separate your property or move on from this relationship. For example, you shouldn’t say that your spouse can have anything they want from your marriage just because you’re guilty about ending your relationship. Instead, you need to separate your emotions about your marriage from the legal process of dividing your assets. By law, you are able to seek half of your marital property since Texas is a community property state. There is no reason to relinquish your fair share just because of guilt.

How do you move past guilt to approach your divorce fairly?

It may not be easy to move past feelings of guilt, but remember that it does take two to end a marriage. Both of you may have played a role in the end of your marriage, so even if you were the one who pulled the trigger, both of you have at least some responsibility.

Approach your separation realistically. Look at what you need to be able to support yourself and move forward with good financial security. Ask for your share of assets, because you and your spouse worked to build those assets together. Even if you feel bad about the end of your relationship, you still deserve a share of the property and financial support you’ve built over time.

from Texas Bar Today https://ift.tt/3pg7FMh
via Abogado Aly Website