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The 10 Biggest Legal Mistakes Women Can Avoid!
- Protect yourself with a prenuptial agreement. Spouses should have separate lawyers and the agreement should be worked out well ahead of the wedding.
- Protect yourself in marriage. Cash and investments that are yours before a marriage should be kept separate from joint bank accounts. Also understand your husband's business; you'll be responsible for his debts or lawsuits if he dies unexpectedly.
- Protect yourself in divorce. Don't use the same lawyer as your spouse. Remember that this is a legal battle, not an affair of the heart where you are to play "nice" of "fair"
- Protect yourself when starting a business. Consider which type of liabilities the business may face. Consider setting up a corporation or a limited liability company.
- Protect yourself when running a business. Understand the laws, including labour and tax laws.
- Don't sign documents you don't understand. Have a lawyer review all business documents.
- Hire the right lawyer. Hire a specialist in the field.
- Always report all your income and file tax returns on time.
- Be careful about co-owning property and always have thorough title searches done.
- Plan for your death to make sure that assets are distributed to those you love.
Source: Marilyn Barrett, phone # (310) 551-9137.
How To Save - Legal Costs
Family law litigation is often protracted and expensive. You have a dispute with your Ex! You cannot agree on the appropriate amount of spousal or child support! You retain a lawyer! You instruct your lawyer to prepare the necessary documents, go to court and obtain a support order! You get a good result and think that you have won this round.! Think again. The judge didn't award you court costs and you still must pay your lawyer.
Costs may be awarded to a successful party at any stage of the proceeding. Although judges may award the successful party his or her costs, in family law disputes, often they do not. A judge will exercise discretion when deciding whether or not to award costs. Could it be that there is concern amongst judges that a costs award may fuel the litigation.? An award of costs might be interpreted by a litigant as validating his or her position. Many judges reserve awarding costs in interim proceedings until the case is finally determined.
Hope that your case settles long before trial. If not you may be able to claim some of your legal costs as a tax deduction if you fit Revenue Canada's criteria.
Revenue Canada - The Rules
In matrimonial disputes, only certain legal and accounting costs can be deducted from your earned income. Timing is the critical factor!
Deductible v. Not Deductible
- Costs incurred in obtaining a court order for support during marriage are deductible.
- Costs incurred in obtaining support as corollary relief on divorce are not deductible.
- Costs incurred in enforcing support pursuant to an order or an agreement are deductible.
Reasoning: Support rights arise on marriage, but are discretionary on divorce. Costs incurred in relation to obtaining support on divorce are not deductible. Revenue Canada has ruled that these costs relate to the creation of a capital asset, not the enforcement of payment from a right already in existence.
Q. Can you recover costs for attendance at court or for out of court procedures, such as Examination for Discovery?
A. Legal or accounting costs such as the fee paid an accountant for the valuation of a dental practice, or the fee paid to a lawyer for preparation and attendance at Examinations for Discovery, if incurred in relation to obtaining a court order for support and incurred during marriage are deductible.
Q. Are legal costs for the negotiation of the terms of settlement the preparation of a separation agreement or marriage contract deductible?
A. If the negotiations take place during marriage and result in a court order for support, they may be deductible.
Although Revenue Canada has ruled that costs incurred in obtaining a separation agreement are not deductible lawyers usually advise clients to deduct the costs incurred in negotiating the agreement, particularly the portion relevant to support. While the costs relating to support are usually allowed, they may not withstand the scrutiny of an audit. To ensure deductibility, a court order should be obtained.
J.W.
Assessment -The Dirty Word!
Read about what you can do about excessive legal accounts In the next issue of JW Dental Legal News I will discuss what you can do about excessive lawyers accounts.
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