Cheating Contract Unenforceable

The Supreme Court of Iowa has held that if your spouse cheats and you and he/she enter into a contract that states that if the cheating continues certain stipulations will occur in the event of a divorce, (i.e. a sum certain of alimony will be paid, certain bills will be paid, etc.) said contract is unenforceable.

In the case of In re: the Marriage of Cooper, Mr. Cooper was engaging in an extramarital affair. When Mrs. Cooper found out, in an effort to save the marriage, the parties put together a contract, the terms of which dictated what their agreement would be if the cheating did not cease and divorce resulted from the infidelity. The cheating continued and when Mrs. Cooper found out, she filed for divorce and attempted to enforce the contract. The District Court enforced the contract but on appeal the Court of Appeals denied the enforcement of the contract. Upon further review, the Iowa Supreme Court agreed that the contract was not enforceable as it was against public policy for the Court to get involved in such matters and it interposed the concept of “fault” into the law. Iowa is a no fault state when seeking a divorce and determining alimony/property issues. The moral of the story--Don’t contract with your cheating spouse as to what will happen if a divorce occurs. The contract is not worth the tear stained paper it is written on.

The New "Pure Income Shares Model" of Child Support has been Adopted!

The Iowa Supreme Court has now adopted the new child support guidelines which will go into effect on July 1, 2009. These new guidelines are premised upon the concept that both parents have a duty to support their child(ren) and that the support should relate to the true cost of raising a child. The guidelines will now establish the support obligation so that it is more in line with each parent's proportional income. There is also a new provision that focuses on the obligation of a parent who does not have physical care of the child(ren) and whose net income is below the poverty level.

Additionally, the allocation of the expense for health insurance premiums has also receiving an overhaul so that the ever rising costs associated with health insurance is more evenly distributed.

Other items of importance include, but are not limited to:

• Changes to the amount of the qualified additional dependent deduction;
• Changes to the extraordinary visitation credit;
• Use of potential earning vs. actual earning must be by agreement or court determination;
• Increase in the calendar year expense paid by the custodial parent (from $500 for all children to $800)

Legislative Watch!!!

The Iowa Legislative session is underway and the following are a few bills of interest that have been introduced this session:

Senate File 22: This is a bill relative to the payment of college expenses (post secondary education subsidy) for a child whether the parents of the child were married to one another or not. Currently, the law provides that only married parents have this obligation. If the bill passes it would require, once paternity has been established, a determination of whether good cause exists for payment by the parents of college expenses for the child.

House File 60: This bill relates to a name change for a child under the age of 14. Under the law currently in effect, when a petition to change a child’s name is filed you must have the written consent of both parents. If one parent does not agree to the name change a hearing has to be held. The court can waive the consent requirement if the court finds that the parent has abandoned the child, has not provided financial support for the child without good cause, or the parent does not object to the name change after proper notice is given. This bill will eliminate the requirement that both parents consent but does require the court to hold a hearing to determine if it is in the child’s best interest to change his/her name.

House File 240: This bill would require the child support guidelines to provide that 10% of the child support be set aside in a separate fund and invested for the child until the child reaches age 25, unless the court determines that the set aside of said funds would not be in the best interest of the child.

Check back to see how the bills progress during this legislative session.

Its Almost Time for Taxes - Don't Forget your Dependency Exemption!

Tax time is once again around the corner and for those of you who were awarded the dependency exemption in your divorce you will be entitled to an exemption of $3,500 for a qualifying child (this will increase to $3,650 in 2009). The parent who received the exemption is not only entitled to this exemption but is also potentially entitled to other exemptions/credits directly tied to the dependency exemption. For example, the parent who claims the dependency exemption is also entitled to the Child Tax Credit. Check with your attorney or tax preparer regarding other potential exemptions/credits for which you may be eligible if you are entitled to the dependency exemption.

Also, don't forget that if your Decree was entered before 1984 you must attach the Form 8332 to claim the exemption if you are not the custodial parent. If your Decree was entered between 1984 and 2008 you can attach certain pages of your Decree instead of Form 8332. If your Decree is entered after 2008 you will once again be required to attach Form 8332. It would be best to contact either your tax preparer or your attorney to determine what documents will be necessary to attach this year and in the future.

New Child Support Guidelines are in the Works!!!

Sounds like the Supreme Court of Iowa is hard at work reviewing massive revisions to the current Child Support Guidelines. We will not know the final product until July 2009. Check back for updates as the Guidelines prepare to undergo vast changes.