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"10 Most Expensive Tax Mistakes That Cost You Thousands"
The best marriages, so they say, age like fine wine. They gain richness, and color, and depth. They ripen and mellow as experience piles upon experience, bonding the couple and deepening the intimacy as husband and wife (Or Husband and Husband or Wife and Wife - this stuff applies to us now too you know) stroll hand-in-hand through the majestic tapestry of life. (Cue the rainbows, and unicorns, and George Harrison lyrics.)
Remy and Lara Trafelet didn't have that kind of marriage. Their union aged more like milk. No, scratch that. Imagine strapping a toddler into his car seat to go see Grandma on a hot summer day. You hand him a sippy cup of milk to keep him pacified for the drive. Halfway there, he drops the cup and it rolls under the front seat — but you forget it's there. Three weeks later, when you can't ignore the smell, you find the results. What is it? Some mutant strain of . . . cottage cheese, maybe? Something even worse? That's what happened to Remy and Lara's marriage.
Ordinarily, the IRS wouldn't care about a couple of feuding spouses. But Remy is one of Wall Street's fatter cats, a hedge fund manager who did well enough before the recession to treat 100 of his employees to a long weekend at Venice's five-star Hotel Bauer. He's struggled a bit since then but he's still worth $200 million or so. That's enough to give the IRS a stake in the fight — although maybe not what you think.
From the outside, the Trafelets lived an enviable life. They split their days between a $15 million Park Avenue apartment, a $10 million Long Island house, a grouse-hunting estate in Scotland, a quail-hunting estate in Georgia, and two morehouses. (Seriously, did they really shoot so many birds they needed two estates for it?) They supported a personal trainer, a chauffeur, a private chef, and a 16-seat jet. Apparently, though, all that money failed to buy happiness, and the couple filed for divorce in 2015.
Lara may not have loved her husband anymore. But she still loved the money. So, she hired a squad of accounting ninjas to "kick him between his legs and bring him to his knees." And the ninjas were happy to oblige, working "around the clock" to sort through Remy's "multi-layered complex web of business entities." They even set up a dedicated conference area called the "War Room" for Lara to use. That effort helped convince a judge to bump her interim alimony from $17,000 to $45,000 per month.
But financial samurai don't come cheap, and when they sent Lara a bill for $4.2 million, she freaked. Now she's fighting them in court, too! (Honestly, it sounds like it sucks to be Lara.) Here's where our friends at the IRS come in. The good news is, legal fees for arranging alimony are deductible. So Lara should be able to write off at least part of her bill. The bad news is, the rules are about to change, and starting in January, alimony won't figure into taxes anymore. So she better hope she can wrap things up fast!
Now, lots of us have a painful breakup or two under our belt. But we've never had to put our accountants' kids through college to sort it out!
Fortunately, not all accounting ninjas bill millions. Take us, for example. We can help make sure you aren't paying more tax than you legally owe. And we promise not to bill you seven figures unless we save you millions more. So call us when you're tired of overpaying, and we'll even let you decide how to share it with your spouse!
John Leidy, EA
DIY Books Coach
It was the third day of the very first income tax course when I realized that it will become my mission to help people understand their taxes better to be able to make better decisions and STOP wasting money on taxes they should not have to pay.