Can a divorce judge deny IRS approved write offs in a corporate tax return

UPDATED: Oct 1, 2022

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Can a divorce judge deny IRS approved write offs in a corporate tax return

If the husband owns a landscape company that
is incorporated as a S Corp. can a divorce
judge deny write offs for equipment and
vehicles that were purchased by the company?

The right off/purchases were bought by the
company and were used as a right off that was
approved by the IRS. I would think that the
company is a separate entity that a judge
should not be able to rule on even though it
would effect the bottom line of the husbands
income and ultimately effect his average
income for support and maintenance here in

Asked on April 10, 2019 under Family Law, New York


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

Tax law is not the same as determining what is a person's (or business's) assets for purposes of distribution in a divorce. There are many "paper" write-offs and deductions that do not in fact affect the real value (what someone would pay for) an asset, for example. For purposes of the divorce, what matters is the actual value, not the tax value, since if they were to sold or liquidated, they would bring in the actual value, not what they are considered to be worth for tax purposes.
And if the company is a sole owner S-corp, because the husband has 100% control over the company and its assets, it is, for this purpose, appropriate to treat it and its assets as assets of the husband. Having 100% control, he can pay himself from the company, take distributions from it, decide to sell its assets, etc.: it is as much his for divorce purposes as if it was a sole proprietorship. Family/divorce law does not let a spouse "hide" assets from his/her spouse by having them in a separate entity which nonethelss is 100% controlled by him or her.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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