Posts tagged with "CBS MoneyWatch"

‘Tis the season to divide property

December 27, 2018

The holiday season traditionally brings families together, but this year it’s a different story: Divorce lawyers are celebrating a Merry Christmas, as they work overtime to help sparring spouses untie the knot before the new year, when the Tax Cuts and Jobs Act of 2017 will change the way in which payments between ex-partners are assessed, according to a report by CBS Moneywatch.

In fact, U.S. divorce lawyers. say they’ve seen up to fourfold increases in their workloads, while courts are also staying open longer to accommodate the flurry of couples scrambling to make their splits official so they can benefit from allowances under previous tax rules.

In a memo obtained by CBS MoneyWatch, Florida Judge Tarlika Navarroof the Seventeenth Judicial Circuit Court recently cited the “changing tax laws” in saying she would make herself available for hearings over the Christmas holiday—including offering court extra sessions on December 27  and December 28, when the court is normally closed.

Lynne Strober, co-chair of the matrimonial and family law practice group at Mandelbaum Salsburg in Roseland, New Jersey, told CBS that she is working “crazy hours” to complete divorce settlements by year-end, noting, “Everyday I am working on getting a different case resolved,”

Under current law, the person on the hook for alimony in a divorce — typically the higher-earning spouse—can deduct those payments from his or her income, and it is the lower-earning ex who is taxed on that sum.

But, under the Tax Cuts and Jobs Act, signed into law by President Trump in December 2017, the tax burden shifts from the alimony recipient to the person writing the check. That could mean more revenue for the federal government—given that the payer is usually in a higher tax bracket.

In changing the tax law, the House Ways and Means Committee called the current treatment of alimony a “divorce subsidy,” the network news outlet said—arguing that “a divorced couple can often achieve a better tax result for payments between them than a married couple can.”

Dueling spouses have often separated and filed for divorces in January, after family holiday obligations are endured, but the looming tax deadline also gives couples incentive to finalize a split quickly.

Steven J. Mandel, a family law attorney based in New York City, told Moneywatch that he saw a big uptick in couples filing for divorce in June and July. In most cases, he said, his clients already had been planning—or at least considering—a divorce. “I’ve never heard a couple say, ‘Let’s get divorced to save some money on our taxes,’ ” he said.

Divorcing couples hoping to beat the clock are now at the mercy of the court system—which has a backlog of cases waiting to be heard. “We have been calling up the clerk and court personnel to see if there is any way we can get our clients’ cases expedited,” Mandel said.

Research contact: @MeganCerullo

The Harvard degree as a ‘golden ticket’: Why admissions policies are crucial

October 31, 2018

Harvard‘s admission process is on trial in a Boston-area courtroom, with the Ivy League college defending itself from allegations it discriminates against Asian Americans, based on “personal qualities.”

If the charges are proven, the university—which continues to be ranked number one in the nation—would be guilty not only of affecting the college experience of Asian-American applicants; but of downgrading their financial futures, based on the underlying fact that a Harvard degree remains one of the most valuable in the country, CBS News reports.

A decade after graduation, Harvard grads earn median annual pay of $129,000, or 58% more than the $81,600 in median annual pay earned by non-Ivy League college graduates, according to data provided to CBS MoneyWatch by PayScale, the network news outlet said.

Even among Ivy League schools, Harvard edges out the competition: graduates of all Ivy League colleges earn $124,600 after a decade in the workforce, PayScale found.

On top of higher pay, Harvard graduates receive access to a network of famous and successful alumni including Supreme Court Justice John Roberts, former Fed Chairman Ben Bernanke, actress Natalie Portman and drop-outs such as Facebook CEO Mark Zuckerberg.

It’s no wonder that a Harvard degree is considered a “golden ticket” to a better future by many students and their parents. At the same time, CBS said, it’s harder than ever to gain entry to an Ivy League school, with admissions rates for Harvard and its competitors dropping to all-time lows.

Last year, almost 43,000 students applied to Harvard—but only 5% received an acceptance letter, one of the lowest admittance rates in the country.

And, as competition for acceptance by Harvard has grown stiffer, its admissions practices have come under scrutiny. In 2014, an anti-affirmative action group called Students for Fair Admissions sued Harvard, alleging the college’s admissions policies discriminate against Asian-American students.

On its website, the group says, “There is a line between ‘competitive’ admissions and just flat out ‘unconstitutional’ ones. Help us draw that line!”

Asian-Americans had an average acceptance rate to the school of 8.1% from 1995 to 2013according to an October 19 story by the Harvard Crimson, which cites data presented at the Harvard admissions trial now underway in a Boston courtroom.

That’s the smallest rate of any racial group, with Hispanic-Americans and African-Americans experiencing an acceptance rate of 10.6% and 13.2%, respectively. Whites have an 11.1% acceptance rate.

Asian-Americans are allegedly held to “a far higher standard than other students,” the Students for Fair Admissions claim in their lawsuit, CBS News said. The complaint cites a Harvard Crimson survey of 2017 freshman, which asked them their SAT scores. The results found East Asians and Indians scored above the survey’s median SAT result of 2237, while other minorities scored below the survey’s median.

“Harvard requires much more of its Asian-American applicants than it requires of other races and ethnicities,” the complaint alleges.

However, the network news outlet reports, there are two group of students that appear to have a remarkably easier acceptance rate: children of Harvard graduates and children of large donors. In evidence presented during the trial, internal Harvard emails appear to signal the college’s preference for applicants with well-heeled parents—contributing to the notion of “the rich getting richer,” by which many of the Ivy League schools and future employers abide.

Research contact: studentsforfairadmissions@gmail.com