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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16547
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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I'm trying to find a solution to fairly and lawfully split

Customer Question

Customer: Hi! I'm trying to find a solution to fairly and lawfully split the income from a share in a chain of urgent cares in Oregon. My ex-husband technically can only own the share because he's a physician and the bylaws state all owners must be physicians. We invested when we were married. He agreed to a lot me 40% of all income. Now that the settlement is final, he's freaking out and we're getting letters from his attorney stating that there is no way for me to have the money and I must be bought out. Do you know a good way to do this tax wise? My attorney states a K-1 on his tax return is the best way. I'm wondering if there's other ways?
JA: Thanks. Can you give me any more details about your issue?
Customer: Basically the issue is disentanglement. Originally he had no problem simply having 40% put in my account and 60% in his. He and his attorney now state we'd still be financially tied together. There's also concern that my tax bracket is lower than his, therefore why should he pay the tax at his rate, etc. The K-1 seems like a good choice and they originally agreed but now that it's almost over (it's been going on almost 3 years!) he's claiming that that's too complicated. It's ridiculous. I'm just searching around the web to see if anyone has a solution but I can't find any info on this weird scenario.
JA: OK got it. Last thing — Tax Professionals generally expect a deposit of about $32 to help with your type of question (you only pay if satisfied). Now I'm going to take you to a page to place a secure deposit with JustAnswer. Don't worry, this chat is saved. After that, we will finish helping you.
Submitted: 10 months ago.
Category: Tax
Expert:  Megan C replied 10 months ago.

Thank you for your question --- in this situation, perhaps have your husband pay you some sort of alimony. This is deductible to him on his personal return, and taxable to you. It would not impact the ownership of the property, and would not be a business expense. This should be an option discussed with your attorneys. He may need to pay the alimony over time if he does not have the cash to do it right now. At this rate, though the solution would be in 2016 not 2015. Unfortunately there's no way to do this in the past.

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