At the start of the materials, participants should identify the following topics for study:

* Marital tax liability
* Transfers incident to divorce
* Alimony & child support
* Debt cancellation & income inclusion rule
* Reduction of tax benefits
* Foreclosure
* Repossession of personal property
* Repossession of real property
* Non-business bad debts
* Business bad debts

1. List tax considerations and apply tax guidance to marital breakdowns, identify marital status, and describe the effect marital status has on filing status and federal income tax obligations.
2. Contrast and compare the state marital property provisions, explain §1041 identifying at least two tax traps for the unaware, and list seven variables that determine whether a payment is alimony.
3. Identify the exceptions to the general income inclusion rule and explain tax impact, and point out the various issues related to calculating gain or loss resulting from foreclosure or repossession including the differences between personal and real property repossession, amount realized on sale or other distribution of property in a foreclosure, and basis calculation on repossession of property.
4. Contrast nonbusiness and business bad debts under §166 explaining differences in Code requirements and amount allowed.

Chapter 1 - Making the Best of Bad Situations

 Marital Tax Liability

Filing Status

Marital Status

Abandoned Spouse Rule - §7703

Joint Return

Innocent Spouse Exception

Refund Offset Program - §6402

Injured Spouse - Form 8379

Separate Returns

Disadvantages of a Separate Return

Advantages of a Separate Return

Head of Household

Exemptions for Children of Divorced Parents

Unified Definition of a Child

Children of Divorced or Separated Parents

Divorce Costs

Tax Advice - §212(3)

Fees to Obtain Property - §1012 & 1016

  Transfers Incident to Divorce

Property Rights

Marital Property

Common Law Property

Community Property

Equitable Distribution

Premarital Agreements

Limitations

Enforceability Requirements

Property Settlements

Section 1041

Incident to Divorce

Related To Termination

Divorce or Separation Instrument

Property Basis

Bankruptcy

  Alimony & Child Support

Spousal Support - aka Alimony

Voluntary Payments

Payment Must Be In Cash

Payments to a Third Party

Designating Payments as Not Alimony

Members of Different Households

Termination at Death

Child Support

Joint Return Prohibited

Recapture of Alimony

Child Support

Contingency Relating To the Child

Clearly Associated With a Contingency

  Debt Cancellation & Foreclosure

Income Inclusion Rule

Exceptions from Income Inclusion

Order of Exclusions

Bankruptcy Case Exclusion - §108(a)(1)(A)

Insolvency Exception - §108(a)(1)(B)

Qualified Farm Debt Exclusion - §108(a)(1)(C)

Qualified Farm Debt - §108(g)(2)

Qualified Person - §108(g)(1)

Real Property Business Debt - §108(a)(1)(D)

Qualified Debt

Exclusion Limit

Ordinary Income Recapture

Partnerships

Deemed Distribution Rules

S Corporations

Student Loan Exception - §108(f)

Purchase Money Debt Reduction Exception - §108(e)(5)

Cancellation of Deductible Debt Exception - §108(e)(2)

Reduction of Tax Benefits (Attributes) - §108(b)

General Ordering of Tax Attribute Reduction

Basis Reduction

Depreciable Property Election

Procedure

Required Reduction

Timing of Basis Reduction

Limit on Basis Reduction

Recapture of Basis Reductions

Exempt Property

Special Basis Reduction Rule for Qualified Farm Debt

Qualified Property

Basis Reduction Order

Exclusion Limit

Individual Bankruptcy

Partnership Bankruptcy

Depreciable Property

Allocation of Debt-Discharge Income

Corporate Stock-For-Debt Rule

Token Share Inclusion

Workout Inclusion

Recapture of Gain on Later Sale

Debt Contributed to Capital

Debt-For-Debt Exchange

Earnings & Profits

S Corporation Bankruptcy

Net Operating Losses

Adjustments to Shareholder’s Basis in Debt

Bankruptcy Estate as Shareholder

Reporting

Amount Realized On Sale or Other Distribution of Property

Foreclosure

Nonrecourse Indebtedness

Recourse Indebtedness

Mortgage Relief Act of 2007

Reporting

Form 1099A

Timing & Character of Gain or Loss

Gain

Loss

Lender’s Tax Impact

Foreclosure Sale

Discounted Acquisition of Debt

Transactions Involving Related Parties

Related Persons

  Repossession

Personal Property

Non-Installment Method Sales

Basis of Installment Obligation

Gain or Loss on Repossession

Installment Method Sales

Basis of Installment Obligation

Gain or Loss on Repossession

Basis of Repossessed Personal Property

Bad Debt

Real Property

Conditions

Figuring Gain on Repossession

Limit on Taxable Gain

Repossession Costs

Indefinite Selling Price

Character of Gain

Basis of Repossessed Real Property

Holding Period for Resales

Buyer Improvements

Bad Debt

Seller’s Former Home Exception

  Bad Debts

Non-Business Bad Debts

Totally Worthless

Determining Worthlessness

Required Basis or Income Inclusion

True Debt

Loan or Gift

Loan Guarantees

Political Debts

Mechanics’ Liens

Insolvency of Contractor

Secondary Liability on Home Mortgage

Reporting

Recovery

Business Bad Debts

Credit Transactions

Income Inclusion

Accrual Method Taxpayers

Cash Method Taxpayers

Former Business

Debt Acquired from a Decedent

Political Debts

Insolvency of Partner

Business Loan Guarantees

Reporting

Methods of Treating Bad Debts

Specific Charge-Off Method

Partly Worthless Debts

Deduction Disallowed

Totally Worthless Debts

Recovery of Bad Debt

Property Received for a Debt

Bankruptcy Claim

Sale of Mortgaged Property

Net operating Loss

Nonaccrual-Experience Accounting Method

Performing Services

Interest & Late Charges

Glossary