Florida divorce: Error to decide equitable distribution based on speculative tax liability on forgiven debt
Posted by Nydia Streets of Streets Law in Florida Divorce
It is possible for mistakes to be made in a Florida final judgment of divorce. This is why parties have the right to revisit the judgment through the appellate process. In Diaz-Silveira v. Diaz-Silveira, 3D18-919 (Fla. 3d DCA April 29, 2020), the trial court’s final order was appealed regarding equitable distribution and attorneys’ fees.
The parties’ marriage was reportedly one in which they lived beyond their means and incurred significant debt. After a trial, the court awarded possession of the marital home to the former wife until the parties’ son reached the age of majority. The marital assets and debts were otherwise equitably distributed except for the former wife’s contention that the trial court included in the equitable distribution scheme a credit card debt that had been paid off, resulting in less equity to her. The former husband cross-appealed on the issue of attorneys’ fees and costs which he was ordered to pay to the former wife.
The appellate court agreed with the former wife about the credit card debt. There was evidence presented that the debt had been forgiven by the credit card company. The former husband argued he may still owe tax liability on the discharged debt, but by the time of trial he could not produce any evidence of owing any tax liability, and he had not received notice of owing the tax liability within the previous 2 years. Therefore, the appellate court reversed the assignment of this credit card debt to the former husband, thereby crediting the former wife with $7,100 in the equitable distribution scheme.
As to the former husband’s appeal on the attorneys’ fee award, he argued it was improper because the former wife had not requested the same. The former wife agreed this was error, so the case was remanded to the trial court to correct this error. If you are facing a Florida divorce, consult with a Miami family law attorney to understand how the law may apply to your case.