Many small business owners and consumers throughout California have probably had to make some modifications to their personal budgets and business plans over the past few years in order to adjust to the challenging financial and economic times our country has faced.
But as the recent bankruptcy filing of one San Diego business has shown, even business owners and consumers who make careful financial decisions cannot always prevent bad things from happening to them that could completely damage their seemingly stable financial situations.
According to The Wall Street Journal, a national medical records firm learned that one of its offices in San Diego had been broken into on New Year’s Eve. The burglary caused the firm to lose the important electronic data and information of about 14,000 patients. This loss of information has certainly caused many patients to worry about having their identities stolen, but it has also forced the company to file for Chapter 7 bankruptcy protection due to the costs and threats of lawsuits resulting from the data breach earlier this year.
The Wall Street Journal reported that the San Diego-based medical records company filed for bankruptcy protection last week. The firm listed about $226,000 in assets and more than $580,000 in liabilities. By filing Chapter 7, the company will liquidate its assets in order to pay off some of its liabilities. Because the company’s liabilities are reported to be more than the company’s assets, the company may be considered insolvent according to most debt settlement lawyers.
The company did take appropriate actions to report the data breach. However, the repercussions of the incident resulted in costly damages that the company believes it will not be able to recover from.

Alimony, which is also known as spousal support, is one of the most difficult areas of New Jersey divorce law. Alimony is a regular payment made from one ex-spouse to another after a divorce. It was originally meant to help support women after a divorce, but New Jersey alimony laws are now gender-neutral and either spouse may receive alimony.

There are also tax implications for alimony. Time Magazine reports that alimony can help lower a tax bill for the spouse paying alimony because it is an above-the-line deduction. This means that the paying spouse does not have to itemize on his or her return to get the advantage of the deduction.

Like many things in the tax and divorce world, many rules and exceptions do exist for alimony. For example, an alimony payer cannot deduct alimony paid to an ex-spouse that still lives in the same home. Therefore deciding to stay with an ex-spouse to save money may end up costing that spouse a lot of money during tax season.

For tax purposes alimony payments must also be made pursuant to a written separation or divorce agreement, Time Magazine reports. These payments cannot be considered child support. This typically impacts couples who are in long divorce proceedings involving money disputes or child custody battles.

Alimony is also not awarded in every divorce. Factors in determining whether alimony is appropriate include:

  • What assets were brought in and are being taken out of the marriage;
  • The length and standard of living during the marriage;
  • The health and earning capacity of each spouse.

Alimony is not determined using a formula and is not a required to be awarded. Therefore alimony awards vary by county and judge. An experienced divorce attorney can help navigate the complicated alimony laws and help achieve an alimony and tax outcome that is most appropriate for a client.