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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. Linda, I sure hope you are not seeking a law license, for such eighteenth century sentiments could result in your denial in some jurisdictions minting attorneys for our tolerant and inclusive profession.

  2. Mazel Tov to the newlyweds. And to those bakers, photographers, printers, clerks, judges and others who will lose careers and social standing for not saluting the New World (Dis)Order, we can all direct our Two Minutes of Hate as Big Brother asks of us. Progress! Onward!

  3. My daughter was taken from my home at the end of June/2014. I said I would sign the safety plan but my husband would not. My husband said he would leave the house so my daughter could stay with me but the case worker said no her mind is made up she is taking my daughter. My daughter went to a friends and then the friend filed a restraining order which she was told by dcs if she did not then they would take my daughter away from her. The restraining order was not in effect until we were to go to court. Eventually it was dropped but for 2 months DCS refused to allow me to have any contact and was using the restraining order as the reason but it was not in effect. This was Dcs violating my rights. Please help me I don't have the money for an attorney. Can anyone take this case Pro Bono?

  4. If justice is not found in a court room, it's time to clean house!!! Even judges are accountable to a higher Judge!!!

  5. The small claims system, based on my recent and current usage of it, is not exactly a shining example of justice prevailing. The system appears slow and clunky and people involved seem uninterested in actually serving justice within a reasonable time frame. Any improvement in accountability and performance would gain a vote from me. Speaking of voting, what do the people know about judges and justice from the bench perspective. I think they have a tendency to "vote" for judges based on party affiliation or name coolness factor (like Stoner, for example!). I don't know what to do in my current situation other than grin and bear it, but my case is an example of things working neither smoothly, effectively nor expeditiously. After this experience I'd pay more to have the higher courts hear the case -- if I had the money. Oh the conundrum.

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