The House Passes Their Tax Reform Bill While The Senate Finance Committee Approves an Amended Version of Their Initial Proposal

On Thursday, November 16, 2017, the House passed their Tax Bill with a vote of 227-205.  Thirteen Republican members (eight from New York and New Jersey), along with every single Democrat member, voted “No” on the bill.  Regardless of its passing, however, the bill still faces an uphill battle of aligning with what is emerging in the Senate.

Later that evening, the Senate Finance Committee also voted along party lines, 14-12, to approve the Republican Tax Reform Bill.  Debate continued into the evening on Thursday in the Senate Finance Committee, with several new amendments to the Senate Bill emerging.  The full Senate will take up the Tax Bill after the Thanksgiving Break, with the goal of passing Tax Reform by Christmas, or as President Trump put it “We’re going to give the American people a huge tax cut for Christmas – hopefully that will be a great, big, beautiful Christmas present.”

In light of that, let us take a look at some of the amendments made by the Finance Committee to the Senate Tax Bill.

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Senate Bill and House Amendments

As a follow up to my prior blog post entitled “New Tax Legislation”, last Thursday, November 9, 2017, the House Ways and Means Committee voted along party lines (24-16) in favor of passing the amended Tax Reform Bill to the full House. Since its unveiling on November 2, 2017, however, the House Ways and Means Committee made several amendments to the original legislation. In addition, Senate Republicans released their own proposed legislation on tax reform. In this blog, we will take a look at the revisions to the House Bill, the new Senate Bill, and of course, some key differences between them.

Amendments from the House Ways and Means Committee

Adoption Tax Credit

While the Adoption Tax Credit was reinstated, it was not without some drama. While the Democrats proposed an amendment that would have restored the credit, Republicans voted it down. However, after pushback from religious conservatives, the Republicans ended up reinstating the credit. As a refresher, the initial proposal would have eliminated the Adoption Tax Credit that allows a credit of up to $13,750 per child for qualified adoption related expenses.

Flex Spending Accounts for Childcare

Another interesting reinstatement came after much outcry from constituents regarding the elimination of Flex Spending Accounts for Childcare. An amendment passed earlier in the week restored the accounts, which allows families to save up to $5,000 pre-tax for child care expenses. However, this restoration is limited to the next five years only.

Child Tax Credit

While the Child Tax Credit remains at its increased level of $1,600, up from $1,000, a valid Social Security number will now be required to receive it. Currently, a Child Tax Credit can be claimed with a Social Security Number (issued by the Social Security Administration) or with an Individual Taxpayer Identification Number (“ITIN” – issued by the IRS) for certain nonresident and resident aliens. In other words, an ITIN can be obtained regardless of immigration status, whereas a Social Security Number can only be issued to citizens, green-card holders, and other limited groups, such as refugees and people granted political asylum. The motivation behind this was to eliminate tax credits for illegal immigrants.

Medical Expense Deductions

Presently, individuals are allowed to deduct medical expenses (including long-term care insurance premiums) that exceed 10% of their adjusted gross income. (This floor was actually raised from 7.5% under the Affordable Care Act). The initial tax legislation eliminated this deduction, and even after much debate this week, that elimination remains in the final version from the Committee.

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The Possible Impact to Employee Benefits Under the Proposed “Tax Cuts and Jobs Act”

This article was co-authored by Patrick T. Ryan and Anne Prenner Schmidt

In many cases, Employee Benefit plans represent the most valuable asset accumulated during the marriage. Dividing these funds in the event of a divorce can be a complex process and often have serious tax implications. The GOP proposed tax legislation the “Tax Cuts and Jobs Act” affects Employee Benefits in a significant way.

While it remains speculative to talk about legislation at this early stage, as follow up to our blog published November 6, 2017(1), it is important to understand just how Employee Benefits could be affected under this new proposal. Whether you are happily married or contemplating divorce, it is in the best interest of all married individuals to have an awareness of the employee benefit plans that they or their spouse may be entitled to through their employer, as well as how this impending legislation may affect those benefits.

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New Tax Legislation

Yesterday, the GOP unveiled their proposed tax legislation, the “Tax Cuts and Jobs Act.” While this is just the initial proposal, as soon as next week, the House Ways and Means Committee (the principal tax writing committee of the House) will begin to propose changes and modifications, before sending it to the floor for a vote (which, if it passes would then go to the Senate, and potentially be subject to further changes).

Although speculative to talk about legislation at this early stage – given that it will likely change before it even reaches the House floor, let alone passes the House and/or Senate – it will serve as the main blue print for what the ultimate legislation will look like (if it ever passes – which is still a big if).

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I Am Divorced…Now What? The Top 10 Steps To Take To Safeguard Your Financial Future

Once you have gone through the divorce process and are formally divorced, there are still many steps that can and should be taken to protect yourself. The following is a list of the top ten (10) actions you should take after your divorce has been finalized:

1. The Judgment for Dissolution of Marriage is the document that formally grants the divorce. Keep this document handy to verify to all pertinent institutions that you are actually divorced. Many places require a certified copy which usually has a special raised seal. Make sure you obtain one as part of your divorce process or ask your attorney to get one for you.

2. Unless otherwise required in your Judgment for Dissolution of Marriage, close all joint credit cards, bank accounts, financial accounts and the like. Additionally, remove your former spouse’s access to any and all accounts in your name. You do not want your former spouse to continue to access accounts, withdraw funds or make charges.

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Pet Custody Comes to Illinois

Companion animals, commonly referred to as “pets”, play an ever-increasing role in American society. US pet industry expenditures were $38.5 billion in 2006 and nearly doubled to $66.75 billion in 2016. According to the 2017-2018 APPA National Pet Owners Survey, 68% of US households own a pet, equating to 84.6 million homes.

The strong emotional bond that binds people to their pets is undeniable, and it is a bond that courts and legislatures throughout the country are increasingly recognizing. California Supreme Court Justice Arabian, in his dissenting opinion in Nahrsted v. Lakeside Village Condominium Ass’n, 8 Cal. 4th 361, 390 (1994), summarized it as follows:

The value of pets in daily life is a matter of common knowledge and understanding as well as extensive documentation. People of all ages, but particularly the elderly and the young, enjoy their companionship . . . Animals provide comfort at the death of a family member or dear friend, and for the lonely can offer a reason for living when life seems to have lost its meaning . . . Families benefit from the experience of sharing that having a pet encourages.

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Lesbian and Gay Bar Association of Chicago 30th Anniversary Gala

Matthew Pruyn, Financial Advisor from Robert W. Baird & Co. and Adam Miel Zebelian, Associate at Schiller DuCanto & Fleck LLP

On July 27, 2017, the Lesbian and Gay Bar Association of Chicago (“LAGBAC”) celebrated its 30th Anniversary by welcoming over 200 guests to a gala held at the Peninsula Chicago Hotel. LAGBAC is one of the oldest Lesbian, Gay, Bisexual, Transgender and Queer (“LGBTQ”) bar associations in the country and the first LGBTQ bar association to identify as such in its name. LAGBAC supports and strengthens the LGBTQ legal community by providing networking opportunities; continuing legal education; student grants and scholarships; mentoring to young lawyers and students; and evaluating judicial candidates for office.

The weather was perfect for the outdoor evening rooftop cocktail reception. The highlight of the cocktail party was a bagpipe procession from the rooftop deck into the dining room led by LAGBAC board member, Gavin Quinn. Between courses, LAGBAC Foundation President Jeremy Gottschalk, LAGBAC President Judge Cecilia Horan, State Representative Gregory Harris, and Deputy Mayor Andrea Zopp called to mind the humble beginnings of the organization and recognized the magnificent progress made by both LAGBAC and the LGBTQ community since the organization was founded in 1987. Although it was a night to celebrate, no one in attendance lost sight of the   fact there is much more work to be done in support of LGBTQ rights; especially supporting and fighting for our transgender brothers and sisters.

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LGBTQ Health Care Issues on the Horizon

One of the issues that many people must consider when going through a divorce is health care costs.  How do you even begin to navigate what you should anticipate for health care costs going forward, especially with the possible reality that obtaining health insurance might be more difficult and expensive then you ever imagined?  Under the current administration, these challenges are heightened for those in the midst of a same-sex divorce, as uncertainty about the continuation of the Affordable Care Act “ACA” has left many people, especially those within the LGBTQ community, concerned.  The concerns are warranted.  The current Republican proposed legislation in both the House and Senate could have significant consequences for the LGBTQ community, as the legislation will directly impact the way LGBTQ Americans access health care through the individual market place.

According to the National Alliance on Mental Illness, LGBTQ people are three times more likely to suffer from mental illness then others. The stress associated with the fear of coming out to loved ones and the discrimination the LGBTQ community faces at large can understandably play a large role in depression, anxiety and other mental illness.  Under the proposed legislation, depression and other mental health issues could likely qualify as a preexisting condition and trigger higher health care prices for obtaining treatment.

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The Background and History of Pride Month

Schiller DuCanto & Fleck LLP is committed to gender identity and sexual orientation equality and diversity.  The firm has represented many LGBTQ couples in a variety of family law cases, created an LGBTQ committee and conducts and hosts ongoing educational programs regarding LGBTQ issues. This is the first of a series of blogs regarding LGBTQ history, legal issues, and our evolving landscape.

In Chicago, LGBTQ Pride Month has evolved to include more than just the parade that many may associate with it. In addition to the parade, there are nearly 100 other events that take place in the city throughout June, including speakers, workshops, concerts, plays, and even 5K runs. 1

National LGBTQ Month, othwerise known as Pride Month, is celebrated by millions of people worldwide each June. Its origin can be traced to June 28, 1969 at the Stonewall Inn in Greenwich Village, New York, where a group of LGBTQ patrons resisted a raid by the police, who had targeted patrons on the basis of their sexual orientation. 2

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Legalizing Recreational Marijuana in Illinois

iStock_000021325411XSmall-02Attitudes toward recreational marijuana use are continuing to evolve, with the idea becoming more and more acceptable to more and more people.  In fact, the push to legalize marijuana on a recreational level continues in Illinois.  On Wednesday, March 22, 2017, two state lawmakers from the City of Chicago’s North Side, Rep. Kelly Cassidy and Sen. Heather Steans, introduced legislation that they are sponsoring (Senate Bill 316 and House Bill 2353) which would legalize the recreational use of marijuana in Illinois.  (The House Bill has since gained seven additional sponsors, and the Senate Bill has gained an additional six sponsors).  This legislation would be known as the Cannabis Regulation and Taxation Act.

The goals of the legislation would be to allow law enforcement to “focus on violent and property crimes,” as well as “generating revenue for education and other public purposes, and individual freedom.”  The bill suggests that Cannabis ought to be “regulated in a manner similar to alcohol.”  If that truly is the intent, it will be interesting to see how judges hearing divorce cases will treat it when it comes to parenting issues.

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