CALIFORNIA FAMILY LAW
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Income Tax Matters
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Community Property: Assets
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Employment/Retirement Benefits
............Tax Consequences of Transfer
16 Cards On This Topic:
Benefits received by nonemployee spouse per QDRO are taxable to him/her.
Transfer of IRA to former spouse in dissolution not considered taxable event.
Early withdrawals from IRAs are subject to taxes and penalties; the tax ct. cannot fashion equitable remedies.
W’s receipt of QDRO distribution on behalf of the community means she should not be taxed on the portion that at all times belonged to H; Tax Ct. looked to terms of settlement, rather than QDRO, to determine amount of distribution taxable to W.
C/P interest in IRAs disregarded for tax purposes; H taxed when he withdrew funds from IRA to pay W her share.
Alternate payee is a "distributee" of plan benefits distributed to her, even though initially all paid to H.
No rollover permitted where W deposited H's profit sharing distribution into her IRA; subsequent judgment not a QDRO.
W's gross income included all stock received in distribution pursuant QDRO where she failed prove too many shares distributed in error and she did not deposit into IRA.
Lump-sum distribution to attorney's trust account and subsequent division by stipulation between H and W is not pursuant to QDRO and is all taxable to employee without regard to c/p laws.
Lump-sum distribution rolled directly into IRA of spouse is subject to immediate taxation.
If decree specifically provides for alimony, payments made pursuant to pension division are deemed to be designated as not includable in gross income of recipient.
W, who receives all c/p military retirement benefits in MSA, is taxed on her share as pension income and H's share as alimony.
Non-qual. plan payments specifically awarded to H were includable in his gross income for taxable years in which such amounts paid or made available to H.
Int.Rev. Code §457 plans not subject to IRA roll over or lump sum distributions.
H may surrender tax-sheltered annuities, roll them over into IRAs in his name, then transfer IRAs to W as part of divorce, without triggering a taxable event.
Monies which W receives directly from H's pension plan to equalize division of property not taxable to her.