A Divorce Decree Awarding Joint Legal Custody May Control Beyond Your Child’s 18th Birthday

Are you the divorced parent of a child with a developmental disability? Is your child approaching age 18? Does your divorce decree award you and your ex-spouse joint legal custody of your child? Are you thinking of filing for guardianship of your child? If you answer yes to all of these questions, then you may need to file a motion to modify your decree of dissolution instead of petitioning for guardianship in the probate court.

The case of In the Matter of S.J.M. presented just such a situation. In 2015, the Missouri Court of Appeals, Eastern District, held that the St. Charles County Probate Court erred as a matter of law when it entered a judgment of incapacity and appointed a sole guardian for an 18 year old individual with Down’s Syndrome where the parents’ 2007 decree of dissolution awarded them joint legal custody over their child. The Eastern District found the decree of dissolution was still in effect when the probate court rendered its judgment in 2014, and therefore the probate court produced inconsistent judgments. Continue reading »

Tax Reform Expands Benefit of Tuition Savings, ABLE Programs

The Tax Cuts and Jobs Act of 2017 (TCJA) introduced a number of changes to the tax code for individual taxpayers. Major changes included lowering individual tax rates, increasing the standard deduction, and increasing the child tax credit.

The legislation also made significant, but often overlooked, changes to the tax treatment of contributions to qualified tuition savings and ABLE programs.

Qualified Tuition Programs (§ 529 Plans)

529 plans are tax-advantaged investment plans designed to encourage saving for the cost of education. 529 plans offer a number of tax benefits:

• Earnings. As 529 plans grow in value, earnings on investments are not subject to state or federal income tax, so savings grow tax-free.
• Contributions. In Missouri, owners of 529 plan accounts may deduct up to $8,000 ($16,000 if married filing jointly) of 529 plan contributions from Missouri state income tax.
• Withdrawals. Funds withdrawn to pay for qualifying educational expenses are not subject to state or federal income tax.

Prior to the TCJA, funds withdrawn from 529 plans could only be used for “qualified higher education expenses,” which included tuition, fees, books, supplies, and other equipment required for attendance at an institution of higher education, most often a college or university. Continue reading »