ILNews

Court splits on first impression dissipation case

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An Indiana Court of Appeals judge dissented today from his colleagues' decision that a spouse may be found to have dissipated property after refusing to sign and file joint tax returns because the judge believes the ruling is "bad law and bad policy."

In Anna Mae Hardebeck v. James A. Hardebeck, No. 48A04-0904-CV-212, Judges Edward Najam and Michael Barnes adopted the holding that whether a spouse's failure to file a joint tax return constitutes dissipation under Indiana Code Section 31-15-7-5(4) must be determined from a review of the facts and circumstances in each case. The majority relied on caselaw from Pennsylvania and Tennessee since it was the first time the issue had been addressed in Indiana courts.

The dissolution court ruled Anna Mae Hardebeck dissipated marital assets when she refused to file a joint income tax return for 2006 and 2007 with her husband, James. That cost James more than $8,600 in state and federal income taxes. James filed for dissolution in 2008.

"As in any case involving an allegation of dissipation, the court should consider relevant factors including whether the expenditure benefited the marriage or was made for a purpose entirely unrelated to the marriage, the timing of the transaction, whether the expenditure was excessive or de minimis, and whether the dissipating party intended to hide, deplete, or divert the marital asset," wrote Judge Najam.

The majority noted Anna Mae never suggested she filed her tax returns separately to protect herself because James' returns were fraudulent, and she apparently refused to file their taxes jointly out of spite.

But Anna Mae was within her statutory rights in refusing to file a joint tax return, Judge James Kirsch wrote in his dissent, and she may have been acting with great prudence in doing so.

"I believe that requiring a spouse to execute a joint income tax return in such circumstances and to incur the joint and several liability that accompanies filing such a return, including any deficiencies resulting from it, any penalties assessed because of it and any additional tax liability subsequently imposed on it is bad law and bad policy," he wrote.

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  1. For many years this young man was "family" being my cousin's son. Then he decided to ignore my existence and that of my daughter who was very hurt by his actions after growing up admiring, Jason. Glad he is doing well, as for his opinion, if you care so much you wouldn't ignore the feelings of those who cared so much about you for years, Jason.

  2. Good riddance to this dangerous activist judge

  3. What is the one thing the Hoosier legal status quo hates more than a whistleblower? A lawyer whistleblower taking on the system man to man. That must never be rewarded, must always, always, always be punished, lest the whole rotten tree be felled.

  4. I want to post this to keep this tread alive and hope more of David's former clients might come forward. In my case, this coward of a man represented me from June 2014 for a couple of months before I fired him. I knew something was wrong when he blatantly lied about what he had advised me in my contentious and unfortunate divorce trial. His impact on the proceedings cast a very long shadow and continues to impact me after a lengthy 19 month divorce. I would join a class action suit.

  5. The dispute in LB Indiana regarding lake front property rights is typical of most beach communities along our Great Lakes. Simply put, communication to non owners when visiting the lakefront would be beneficial. The Great Lakes are designated navigational waters (including shorelines). The high-water mark signifies the area one is able to navigate. This means you can walk, run, skip, etc. along the shores. You can't however loiter, camp, sunbath in front of someones property. Informational signs may be helpful to owners and visitors. Our Great Lakes are a treasure that should be enjoyed by all. PS We should all be concerned that the Long Beach, Indiana community is on septic systems.

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