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Pecos Law Group October 2019 Blog

On Behalf of | Oct 1, 2019 | Attorney Blogs, Client Blogs

Marriage Planning and Divorce Planning in Nevada
When you get married in Nevada without a prenuptial agreement, you are expressly consenting to be bound by the laws of Nevada upon a divorce. Prenuptial agreements may not be considered “romantic,” but ugly divorces are even less romantic. It is generally easier to address potential problems or issues before marriage rather than during a divorce. If, however, for some reason you are unable or do not want to ask your prospective spouse to sign a prenuptial agreement, there are specific actions that you may take before marriage to mitigate some of your exposure to Nevada community property law.
Some of the same techniques that are used to protect one’s assets from a creditor may also be used to protect one’s separate property, even without a prenuptial agreement. The use of legal entities and trusts not only provide estate planning benefits but may also provide some financial protection in a divorce where a prenuptial agreement was not used. Further, proper planning using separate bank accounts and avoiding commingling post marriage money with premarital money may also afford some protection. While these alternatives may afford some protection, they cannot completely replace the protections provided by a prenuptial agreement.
If you are already marriage, whether or not you are contemplating divorce, you may still simplify your community finances through a postnuptial agreement. Postnuptial agreements are similar to prenuptial agreements, but they are entered into between spouses after marriage. The scope of what a postnuptial agreement may accomplish is more limited than a prenuptial agreement and the enforcement is more scrutinized by the courts than prenuptial agreements. Postnuptial agreements remain relatively untested in Nevada but may be useful in specific circumstances.
While proper planning before a prospective marriage may provide some financial protection, proper planning before a potential divorce may also be useful. In many cases there is not sufficient time to financially plan for a divorce. In other cases, however, there may be time to obtain benefits from planning a divorce at least several months in advance.

Modifying Alimony Awards in Nevada

Unless otherwise expressly agreed to by the parties, the district court has continuing jurisdiction to modify alimony. See NRS 125.150(7), which states that payments of alimony “which have not accrued at the time a motion for modification is filed may be modified upon a showing of changed circumstances, whether or not the court has expressly retained jurisdiction for the modification.”
The Nevada Legislature amended NRS 125.150 in 2003 to provide that “a change of 20 percent or more in the gross monthly income of a spouse who is ordered to pay alimony shall be deemed to constitute changed circumstances requiring a review for modification of the payments of alimony.” The 2003 amendment to NRS 125.150 expresses the clear legislative intent to permit the court to modify an alimony award where the obligor spouse has sustained a decrease of 20 percent or more in his or her gross monthly income.
In sum, although a court is not necessarily required to modify alimony just because there has been a 20% change in income, the court should review whether specific change of income impacts the fairness it was trying to achieve with the initial alimony award. If it does, the district court should modify the alimony award to maintain it as “fair and equitable.”

Can a Family Court Judge Make Divorcing Spouses File a Joint Tax Return?
The short answer is yes. Under NRS 125.150 the court has the authority to make an equitable disposition of the community property of the parties. When making an equitable distribution of the parties’ community property, the trial court must consider the tax consequences of the property division. In doing so, the court should consider the benefit each party receives from the yearly marital income, as well as the tax liability the income creates. When dividing community property, “trial courts must consider tax consequences when, as in the case at hand, there is proof of an immediate and specific tax liability.” Ford v. Ford, 105 Nev. 672, 677, 782 P.2d 1304, 1308 (1989). The court, therefore, likely has the discretion to compel parties to file joint income tax returns when equitable.
While there are no cases on point in Nevada, other jurisdictions are split on the issue. The majority of states, however, derive the court’s authority to compel parties to file income tax returns jointly from the court’s discretion to consider tax issues when equitably distributing marital property. Bursztyn v. Bursztyn, 379 N.J. Super. 385, 395, 879 A.2d 129,135 (N.J. Super. App. Div. 2005). These states include Alaska, Arkansas, Colorado, Kentucky, Minnesota, Mississippi, New Hampshire, New Jersey, North Dakota, and Ohio. Those states that deny the court has the authority to compel the parties to file joint income tax returns base their reasoning on the individual’s right to file either jointly or separately under the Internal Revenue Code. Despite this federal statutory right, most courts believe that the right may be abridged by state courts. Trial courts must be cautioned, however, when deciding to compel parties to execute joint tax returns because of the “potential liability to which the parties would be exposed, and because there generally exists a means by which to compensate the parties for the adverse tax consequences of filing separately.” Id. at 398, 879 A.2d at 137. When there is a significant financial benefit to filing the tax returns jointly, the court has an obligation to consider the tax implications of its decision. Id. As a result, the court should have the discretion to compel the parties to file joint tax returns.

Will a Family Court Order Parents to Pay Private School for Their Children?
The threshold determination is whether private school is in the best interest of the child. Assuming it is, the court will examine whether the parents are reasonably able to afford the cost of tuition.
The first factor the court will examine is whether the children were enrolled in private school before the divorce. The status quo and maintaining the consistency for children after divorce is usually in their best interest. The authority is clear that a major factor in whether or not to continue children in private schooling after divorce is whether or not they attended private school before divorce. In a Florida case, the court found that private school education should be awarded where the parties had the ability to pay, the expense was consistent with the customary standard of living and the education is in the children’s best interest. Where both children had attended school their entire lives, it is in their best interest to continue.
Next, where the parents are able to afford private school tuition and it was consistent with the parties’ lifestyle, it should be ordered opined a Louisiana court. NRS 125B.080 gives the court the authority to order one or both of the parents to pay for their children’s private school education. Once the court determines whether or not private school education is in the children’s best interest, the issue then becomes how the expenses should be paid.
The Las Vegas family law lawyers at Pecos Law Group have extensive experience in family law issues such as child support.

Can Cohabitating Change Your Alimony in Nevada?
When alimony is modifiable, NRS 125.150(7) requires the court to consider any relevant factors when the payor spouse requests to have the alimony obligation modified. In Gilman v. Gilman, the Nevada Supreme Court adopted an “economic needs” test to determine if cohabitation should affect the payee spouse’s right to receive alimony. According to the Court, “Under this ‘economic needs’ test, the amount of spouse support reduction, if any depends upon a factual examination of the financial effects of the cohabitation on the recipient spouse.” There are ways, however, to draft a Decree of Divorce to protect you from changes in your former spouse’s life, whether you are the payor or payee. The short answer, however, is that if a cohabitation, in the nature of marriage, in some cases, may be sufficient to modify or terminate an alimony award.

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