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Archive for May 3rd, 2012

Divorce in this country, as my brother explained to me before I got married, can be nothing more than a glorified breakup: today’s legal system makes it far easier to get out of a bad marriage than, say, a cell phone contract.

Where divorce gets sticky, however, is when there’s a child involved. Negotiations get contentious, resentment builds, and it’s inevitably the poor kid that suffers most. Unless, of course, the kid is savvy enough to play their mother and weekend daddy against each other in an endless battle for his love and affection. In that case, he or she can really clean up.

That’s not to say divorce with a child involved doesn’t hurt the parents as well. Consider the case of Gary Scalone, who upon getting divorced to his first wife, had to give up custody of his child. As part of their separation agreement, Scalone’s ex-wife agreed that Scalone would be entitled to claim the dependency exemption for his child — and the resulting child tax credit — for the tax year 2000 and all future years, and as long as he stayed current with his child support obligations, she would sign a “form acceptable to the IRS” releasing her right as the custodial parent to claim the child as a dependent.  

Unfortunately for Scalone, by 2006 his ex-wife grew tired of the arrangement, despite the fact that Scalone stayed current on his child support payments. She refused to sign a Form 8332, Release of Claim to Exemption for Child of Divorced or Separated Parents for 2006, leaving Gary high and drive come tax return time. Without a Form 8332, Gary simply attached a copy of the separation agreement to his return, and claimed his child as a dependent and took a child tax credit anyway.

The IRS denied both the dependency exemption and the child tax credit. At this point, a quick review of the dependency rules is in order:

In general, a dependent child is one who gets more than half her support from a taxpayer with whom she lives more than half the year. [i] The general rule for divorced parents is that the “custodial” parent gets the dependency deduction, but a divorce decree or separation agreement can dictate otherwise.[ii]

Divorcing parents can either agree who has custody, or they can leave it to a judge to count the days the child spends with each parent.

Because Scalone did not have custody of his child, the general rules of I.R.C. § 152 deny him a dependency exemption. Section 152(e)(2) provides an exception, however, which applies where the custodial parent signs a written form, called a declaration, in which she states that she won’t claim the child as a dependent and the noncustodial parent then attaches the executed declaration to his tax return for the year. [iii]

Form 8332 has been designed by the IRS to serve this purpose. The 2006 version of the form required:

  • The name and social security number of the custodial parent;
  • The name of the child;
  • The tax year or years the exemption was being released for;
  • The custodial parent’s social security number;
  • The signature of the custodial parent; and
  • The date of the signature.

Because no Form 8332 was attached to Scalone’s 2006 tax return, the IRS disallowed the dependency exemption and the child tax credit. The Tax Court, however, saw things differently and sided with Scalone.

In reaching its decision, the court concluded that  the signed separation agreement — while not containing Scalone or his ex-wife’s social security numbers — “conformed to the substance of Form 8332,” as is allowed by Regulation Section 1.152-4T(a), Q&A 3.

The Tax Court differentiated the present facts from those of previous decisions where a noncustodial parent simply failed to attach any signed declaration to the return or where his right to claim the child was conditioned on other events that could not be independently verified.

Because Scalone’s separation agreement clearly indicated that he was entitled to a dependency exemption for 2000 and all future years, while also containing his ex-wife’s signature and the name of the child, the court held that the absence of his ex-wife’s social security number was not fatal. Thus, the signed separation agreement sufficed as the required declaration.


[i] I.R.C. § 152(a)(1).

[ii] Treas. Reg. §1.152-4(c).

[iii] I.R.C. § 152(e)(2).

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 [Ed note: What follows is a letter penned by renowned horror writer Stephen King to The Daily Beast, reprinted here in its entirety, in which King pleads for tax rates on the rich to be raised. Regardless of what side of the political fence you reside on, the letter is worth a read, as King provides some poignant commentary concerning the growing dissension towards America's wealthiest 1%. Plus, the guy did write The Shining, and that book kicks ass. Be warned: if you don't like strong language, don't get mad at me. Take it up with King.]

Chris Christie may be fat, but he ain’t Santa Claus. In fact, he seems unable to decide if he is New Jersey’s governor or its caporegime, and it may be a comment on the coarsening of American discourse that his brash rudeness is often taken for charm. In February, while discussing New Jersey’s newly amended income-tax law, which allows the rich to pay less (proportionally) than the middle class, Christie was asked about Warren Buffett’s observation that he paid less federal income taxes than his personal secretary, and that wasn’t fair. “He should just write a check and shut up,” Christie responded, with his typical verve. “I’m tired of hearing about it. If he wants to give the government more money, he’s got the ability to write a check—go ahead and write it.”

Heard it all before. At a rally in Florida (to support collective bargaining and to express the socialist view that firing teachers with experience was sort of a bad idea), I pointed out that I was paying taxes of roughly 28 percent on my income. My question was, “How come I’m not paying 50?” The governor of New Jersey did not respond to this radical idea, possibly being too busy at the all-you-can-eat cheese buffet at Applebee’s in Jersey City, but plenty of other people of the Christie persuasion did.

Lobbyist Grover Norquist responds to King and begs to differ, ‘for f@%&’s sake!’

Cut a check and shut up, they said.

If you want to pay more, pay more, they said.

Tired of hearing about it, they said.

Tough shit for you guys, because I’m not tired of talking about it. I’ve known rich people, and why not, since I’m one of them? The majority would rather douse their dicks with lighter fluid, strike a match, and dance around singing “Disco Inferno” than pay one more cent in taxes to Uncle Sugar. It’s true that some rich folks put at least some of their tax savings into charitable contributions. My wife and I give away roughly $4 million a year to libraries, local fire departments that need updated lifesaving equipment (Jaws of Life tools are always a popular request), schools, and a scattering of organizations that underwrite the arts. Warren Buffett does the same; so does Bill Gates; so does Steven Spielberg; so do the Koch brothers; so did the late Steve Jobs. All fine as far as it goes, but it doesn’t go far enough.

What charitable 1 percenters can’t do is assume responsibility—America’s national responsibilities: the care of its sick and its poor, the education of its young, the repair of its failing infrastructure, the repayment of its staggering war debts. Charity from the rich can’t fix global warming or lower the price of gasoline by one single red penny. That kind of salvation does not come from Mark Zuckerberg or Steve Ballmer saying, “OK, I’ll write a $2 million bonus check to the IRS.” That annoying responsibility stuff comes from three words that are anathema to the Tea Partiers: United American citizenry.

And hey, why don’t we get real about this? Most rich folks paying 28 percent taxes do not give out another 28 percent of their income to charity. Most rich folks like to keep their dough. They don’t strip their bank accounts and investment portfolios. They keep them and then pass them on to their children, their children’s children. And what they do give away is—like the monies my wife and I donate—totally at their own discretion. That’s the rich-guy philosophy in a nutshell: don’t tell us how to use our money; we’ll tell you.

The Koch brothers are right-wing creepazoids, but they’re giving right-wing creepazoids. Here’s an example: 68 million fine American dollars to Deerfield Academy. Which is great for Deerfield Academy. But it won’t do squat for cleaning up the oil spill in the Gulf of Mexico, where food fish are now showing up with black lesions. It won’t pay for stronger regulations to keep BP (or some other bunch of dipshit oil drillers) from doing it again. It won’t repair the levees surrounding New Orleans. It won’t improve education in Mississippi or Alabama. But what the hell—them li’l crackers ain’t never going to go to Deerfield Academy anyway. Fuck ’em if they can’t take a joke.

Here’s another crock of fresh bullshit delivered by the right wing of the Republican Party (which has become, so far as I can see, the only wing of the Republican Party): the richer rich people get, the more jobs they create. Really? I have a total payroll of about 60 people, most of them working for the two radio stations I own in Bangor, Maine. If I hit the movie jackpot—as I have, from time to time—and own a piece of a film that grosses $200 million, what am I going to do with it? Buy another radio station? I don’t think so, since I’m losing my shirt on the ones I own already. But suppose I did, and hired on an additional dozen folks. Good for them. Whoopee-ding for the rest of the economy.

Tired of hearing about it, they said. Tough shit for you guys, because I’m not tired of talking about it. I’ve known rich people, and why not, since I’m one of them?

At the risk of repeating myself, here’s what rich folks do when they get richer: they invest. A lot of those investments are overseas, thanks to the anti-American business policies of the last four administrations. Don’t think so? Check the tag on that T-shirt or gimme cap you’re wearing. If it says MADE IN AMERICA, I’ll … well, I won’t say I’ll eat your shorts, because some of that stuff is made here, but not much of it. And what does get made here doesn’t get made by America’s small cadre of pluted bloatocrats; it’s made, for the most part, in barely-gittin’-by factories in the Deep South, where the only unions people believe in are those solemnized at the altar of the local church (as long as they’re from different sexes, that is).

The U.S. senators and representatives who refuse even to consider raising taxes on the rich—they squall like scalded babies (usually on Fox News) every time the subject comes up—are not, by and large, superrich themselves, although many are millionaires and all have had the equivalent of Obamacare for years. They simply idolize the rich. Don’t ask me why; I don’t get it either, since most rich people are as boring as old, dead dog shit. The Mitch McConnells and John Boehners and Eric Cantors just can’t seem to help themselves. These guys and their right-wing supporters regard deep pockets like Christy Walton and Sheldon Adelson the way little girls regard Justin Bieber … which is to say, with wide eyes, slack jaws, and the drool of adoration dripping from their chins. I’ve gotten the same reaction myself, even though I’m only “baby rich” compared with some of these guys, who float serenely over the lives of the struggling middle class like blimps made of thousand-dollar bills.

In America, the rich are hallowed. Even Warren Buffett, who has largely been drummed out of the club for his radical ideas about putting his money where his mouth is when it comes to patriotism, made the front pages when he announced that he had stage-1 prostate cancer. Stage 1, for God’s sake! A hundred clinics can fix him up, and he can put the bill on his American Express black card! But the press made it sound like the pope’s balls had just dropped off and shattered! Because it was cancer? No! Because it was Warren Buffett, he of Berkshire-Hathaway!

I guess some of this mad right-wing love comes from the idea that in America, anyone can become a Rich Guy if he just works hard and saves his pennies. Mitt Romney has said, in effect, “I’m rich and I don’t apologize for it.” Nobody wants you to, Mitt. What some of us want—those who aren’t blinded by a lot of bullshit persiflage thrown up to mask the idea that rich folks want to keep their damn money—is for you to acknowledge that you couldn’t have made it in America without America. That you were fortunate enough to be born in a country where upward mobility is possible (a subject upon which Barack Obama can speak with the authority of experience), but where the channels making such upward mobility possible are being increasingly clogged. That it’s not fair to ask the middle class to assume a disproportionate amount of the tax burden. Not fair? It’s un-fucking-American is what it is. I don’t want you to apologize for being rich; I want you to acknowledge that in America, we all should have to pay our fair share. That our civics classes never taught us that being American means that—sorry, kiddies—you’re on your own. That those who have received much must be obligated to pay—not to give, not to “cut a check and shut up,” in Governor Christie’s words, but to pay—in the same proportion. That’s called stepping up and not whining about it. That’s called patriotism, a word the Tea Partiers love to throw around as long as it doesn’t cost their beloved rich folks any money.

This has to happen if America is to remain strong and true to its ideals. It’s a practical necessity and a moral imperative. Last year during the Occupy movement, the conservatives who oppose tax equality saw the first real ripples of discontent. Their response was either Marie Antoinette (“Let them eat cake”) or Ebenezer Scrooge (“Are there no prisons? Are there no workhouses?”). Short-sighted, gentlemen. Very short-sighted. If this situation isn’t fairly addressed, last year’s protests will just be the beginning. Scrooge changed his tune after the ghosts visited him. Marie Antoinette, on the other hand, lost her head.

Think about it.

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