Archive: March 2018

Tenants filing for bankruptcy is less of an issue for residential landlords, but an increasingly frustrating problem for commercial landlords as we get further into 2018. As a result, it is important—now more than ever—that commercial landlords know what their rights are when it comes to how tenant bankruptcy affects lease agreements.

Rules: Before & After Filing for Bankruptcy

First and foremost, it is crucial to understand that, once a tenant files for bankruptcy, landlords and other parties are prohibited from taking any action against the tenant (i.e. debtor) unless it is first approved by the bankruptcy court. However, if a tenant is in default prior to filing for bankruptcy, and the landlord takes every step required under state law to terminate the lease before they file, the lease is then not subject to the tenant’s bankruptcy case. This is because it is the act of the tenant filing for bankruptcy that imposes an automatic stay against any actions by landlords and other parties (where actions are any activities involving collecting, demanding, or otherwise seeking to recover amounts due).

No divorce is the same as another—each one is unique based upon the relationship and the unique circumstances involved. Still, all divorces have at least one thing in common: the need to make intelligent financial decisions if you’re going through it. Below, we provide some guidance on how to ensure that you are “financially free” after divorce:

Think Of Debt & Credit Scores

While many people contemplating divorce are instinctively concerned about the division of assets, many do not realize that a court also divides financial responsibilities as well, such as debt. Most married couples share accounts, and it can be difficult to maintain your credit if your ex stops paying the bills on a shared account—even if you both agree to take responsibility for this or that credit card or bill. Remember if your name is on something, you are responsible for it—regardless of what the court documents indicate.

You may not realize that, even as of early February, Florida still technically has 17 weeks left of hurricane season, with more and more potential property damage looming. As a result, emergency management officials in Sarasota and surrounding areas are scrambling to put lessons learned after Irma into practice to get ahead of more damage that could be coming to the state of Florida.

Two-thirds of hurricane-related deaths occur due to flooding and storm surge. Some of this organizing involves identifying which buildings can serve as emergency shelters, as well, as how evacuation centers are opened to the public and are both wheelchair-accessible and pet friendly.

Applying For Funding

What does this mean for all of the property damage, and the many individuals dealing with filing insurance claims, and either having those claims denied or delayed? Sarasota County is reportedly in line to receive $8 million in state mitigation funding to make structures more resilient in general.

As attorneys who regularly represent homeowners associations and property managers, we frequently get questions about what the board can do with and without membership approval. These types of questions ultimately come down to distinguishing between what is and is not a “material alteration.”

The general rule is that if the proposed change is a palpable change to the appearance, function, or use of the association property and/or its common element, it constitutes a material alteration. If a homeowners’ association wants to make a material alteration, it must first obtain membership approval. Some examples of material alterations that require membership approval include painting the color of a common area (such as a clubhouse), or placing carports over parking spaces.

What About Landscaping?

There are sometimes questions in the gray areas, such as changes to landscaping. Typically, landscaping decisions are not considered to involve material alterations, and are thus left up to the board’s discretion. This includes decisions involving whether or not certain plant species should be replaced with others, or whether shrubs or vegetarian can be moved, changed, etc.

When couples are contemplating or going through divorce, they already have too much to worry about: Depending upon their particular circumstances, that often includes the family home, the children, assets, and more. The last thing that most couples anticipate is also having to tackle an insurance dispute.

And yet, life insurance policies are one of the most important aspects of the divorce, but without ensuring that the proper documentation is in place, divorcing couples could be setting themselves out for a serious battle.

Support in Perpetuity

Life insurance policies can provide support and assurance where other payments—such as alimony—cannot, as they terminate upon death. Under the law, former spouses can remain named beneficiaries to life insurance policies even after the divorce has long been finalized.

Carefully Craft Your Divorce Settlement

A recent decision out of the United States Court of Appeals for Sixth Circuit upheld the importance of divorce decrees (i.e. settlements) even over later changes in named beneficiaries in terms of what qualifies for a qualified domestic relations order under the Employment Retirement Security Act. This decision reinforces the importance of carefully crafting settlement agreements.

The new tax bill has received a lot of attention in the media. However, many do not realize that it will have implications on divorce and alimony payments (in addition to tax deductions).

Below, we discuss some of the ramifications of the law in greater detail, with a focus on how it complicates divorce.

Perhaps most notably, the Tax Cuts and Jobs Act made significant changes to alimony, eliminating the ability for the alimony payer to deduct the payments from his or taxes, and the mandate for the receiver to pay taxes on alimony payments as income, as applied to divorces entered into after 2018.

Being able to deduct alimony payments was helpful to many families, as it allowed the spouse in the higher tax bracket to transfer money to the spouse in the lower tax bracket, thus allowing for settlements that would pave the way for each party to receive a benefit.

Under the new law, because the alimony payer’s income will be taxed at a higher rate, there will be less money to divide overall between spouses, with more money in general going to the government in the form of taxes.