Author: Sunitha Anjilvel

Law in the Time of COVID-19

Sunitha Anjilvel

Published in the March, 2021 Washington State Bar News

How I ditched my office but maintained my solo practice

For the majority of my 30-year career as a lawyer, licensed in three jurisdictions, I have been a proud solo practitioner. As a solo, I have enjoyed the freedom to adapt my practice to my life, as well as to the volatile nature of the world at large. When I relocated to Washington from California in 2008, it was in the wake of the real estate market crash, and the entire legal industry was suffering. I built my family law practice using my website as the foundational conceptual brick; the other key bricks consisted of my home office technology and my willingness to meet clients in coffee shops. Read more

COVID-19 (Coronavirus) information related to family law in King County

Sunitha Anjilvel

During the COVID-19 (Coronavirus) outbreak our law office will remain open virtually and we are available by telephone, email or videoconference to all existing and new clients. We will be as immediately responsive as possible.

The last few months have been stressful and difficult for all of us as the reality of the pandemic continues to relentlessly confront us. As parents we should stay calm, be informed, and maintain as much consistency for our children as we can under these new, albeit temporary, circumstances. We are all members of a broader community of Washingtonians. Let’s keep that in mind, and let’s work together to respect and protect each other during this health crisis.

What is Stay Home, Stay Healthy ?

On February 29, 2020, Governor Jay Inslee issued a proclamation entitled “Stay Home, Stay Healthy.” The intent of the proclamation (which is currently in effect until May 4 and may be extended further) is to prevent the spread of the COVID-19 virus by limiting personal physical contact, restricting gatherings of people, and limiting businesses to “essential “ functions. Every person in Washington State should follow the Governor’s recommendations to the extent that they can. We encourage everyone to review the proclamation as well as all updated guidance from the Governor’s office. https://www.governor.wa.gov/sites/default/files/Guidance%20Bulletin%20-%20Proclamation%2020-25%2C%2003.31.2020.pdf?utm_medium=email&utm_source=govdelivery

What does this proclamation mean, practically?

  • Limit exposure to other people as much as you can
  • Travel and transportation should be restricted to essential functions such as grocery shopping, medical appointments, and trips to pharmacies
  • If your work is deemed essential, stay informed as to what precautions you should take from a health standpoint
  • In addition to compliance with the proclamation, we encourage everyone who exhibits symptoms of COVID-19 to consult their healthcare provider by phone

How does this affect my parenting plan?

Parenting plans continue to be legally binding orders. If you have concerns about your current parenting plan posing a risk to your child, yourself and/or your family in the face of this pandemic, please seek legal advice. If both parents have concerns about the spread of the virus they both can agree to changes in the plan temporarily in consultation with an attorney. Now more than ever is a time when you as parents should, if at all possible, come to agreements with a view to the safety and health of all.

Are the courts operating at this time ?

The courts in Washington State are working diligently to continue functioning through the coronavirus pandemic in a safe and efficient manner, with a view to respecting the Governor’s proclamations. The Washington State Supreme Court has issued orders outlining guidelines for county courts, and different counties have different guidelines and rules as to how they will operate at this time. King County Superior Court, the court in which King County family law matters are heard, has issued the following directives related to family law matters:

Dated 27 March 2020

FAMILY LAW DURING THE COVID-19 CRISIS WE ARE ONLY HEARING EMERGENCY MATTERS DEFINED AS FOLLOWS:

  • Domestic Violence Protection Order hearings
  • Motions for temporary restraining orders where personal safety is at risk
  • Motions for temporary orders or adequate cause where child safety is at risk or there is a risk of child abduction
  • Motions for temporary orders, child support adjustment, or child support trials by affidavit where a person’s basic financial survival is at issue (i.e., ability to maintain housing, basic necessities, and critical health care) or post-secondary (college) support is at issue and there are deadlines that cannot be moved
  • Return on Warrant hearings
  • Writs of Habeas Corpus and returns where there is a risk of abduction or an imminent risk of harm to the child
  • Weapons Surrender Compliance Calendar
  • Emergency motions on parenting issues where the health or safety of a child or adult is at risk due to COVID-19 All hearings are being conducted telephonically. Please see family law web pages for additional information: https://www.kingcounty.gov/courts/superior-court/family.aspx.

The Local Family Law Rules continue to apply regarding how and where to set hearings. AGREED ORDERS Agreed orders may be submitted to the Ex Parte Department through Ex Parte Via the Clerk (EPVC), as otherwise permitted by Ex Parte Department policies, or as directed by your assigned judge. AGREED DIVORCE FINALIZATION Contact the Family Law Facilitator’s office for instructions and documentation needed to have your divorce finalized.

  • For Kent Cases call: 206-477-2781
  • For Seattle cases call: 206-477-2553

ASSISTANCE FOR SELF-REPRESENTED PARTIES AND FAMILY LAW SERVICES Many services for self-represented parties, including mediation, parenting evaluations, assistance from the Family Law Facilitators, are being conducted by telephone and e-mail. See Family Law web pages for more information.https://www.kingcounty.gov/courts/superior-court/family.aspx. WE ARE NOT HEARING ANY NON-EMERGENCY MATTERS. Specifically, the following are not being heard:

  • Trials unless the trial court finds that an exception should be made based on the emergency criteria
  • Status/Non-Compliance hearings (These are being conducted by paper review)
  • Pretrial Conferences
  • Discovery motions
  • Default motion
  • Any other non-emergency motions, whether they are set in family law motions or set before the assigned judge, including non-emergency motions for revision These procedures are in effect until April 24, 2020, but may be extended.

I have an ongoing case, does it have to come to a standstill?

Not necessarily. If there’s a conflict in your family law case which does not fall under the court’s definition of “Mission Critical” matters, the King County Superior Court will still allow the entry of agreed orders remotely. If you and the opposing party in your case are able to reach an agreement outside of court, a family law attorney can enter Temporary and/or Final Orders through the court’s new guidelines. For information on this process for self-represented clients, read more here: https://www.kingcounty.gov/courts/superior-court/family/facilitator.aspx

A qualified family law attorney can help you pursue a settlement while restrictions remain in place, either through the exchange of settlement offers or the scheduling of mediation with a third party. Many dispute resolution mediators are opening up opportunities for remote mediation, allowing parties to work through conflicts without exposing themselves or their families to the risk of infection.

If you have any questions about how the above King County Superior Court directive applies to your case, and you don’t already have an attorney representing you, please contact us.

Lives depend on social distancing! Please take this health crisis seriously. Be smart, safe and healthy!

Sunitha Anjilvel

This article provided by the Anjilvel Law Group is not a substitute for legal advice and provides information specific to King County, Washington.

 

Dying without a will – two bad ideas

Sunitha Anjilvel

Estate Planning 101

Obviously, we have no control over our death. We do, however, have control over the expression of our wishes and a well drafted set of estate planning documents can avoid a lot of expense and confusion for the people you leave behind.

What happens if I die without a will?  

If you die without a will or you draft a will that is not valid according to Washington law, in legal terms you’ll be considered to have died intestate and any property you have to pass on will be distributed according to what are called the laws of intestate succession. Your heirs  will have to go to court to have themselves or another person appointed as Administrator to ensure that all property passes according to current intestate law.

What are some of the intestate succession rules in Washington State?

In Washington State, if you die while you are married or separated with children your spouse gets your half of community property and one half of separate property, while children take the other half of separate property in equal shares. If you die unmarried or divorced but have children, your children will receive your property in equal shares. Should you have no living children or spouse, but living parents your property will go to them. If you have no living parents, children, or spouse, your siblings will receive your property instead.

What happens to my minor children if I die without a will?

If you die with young children and the children have another living parent custody will most likely default to that parent unless that parents’ rights have been terminated.  If you are a single parent and your child’s other parent has no legal standing, then the situation gets trickier. Ideally any person with minor children will want to draft a will that includes legal and financial guardianship provisions for any minor children.

No one wants to think about death. But failure to adequately prepare could have devastating consequences, leaving your loved ones to deal with difficult choices without an understanding of what YOUR wishes were.

Taxation of Foreign Investors (Part 1)

Sunitha Anjilvel

Q: My Dad’s friend in India just gave me a million dollars to start a technology company, what do I now?

If you have been in the US for any length of time, the first thing you or your friends might suggest is that you need to form a Limited Liability Company, commonly known as an LLC. You don’t want to pay corporate taxes or for an expensive accountant or lawyer, so you find a website that that will register your company for you. You put your father’s generous friend down as owning half of the company, while you own the other half. $300 later, you are registered with the state and are ready to start your new venture!

You make $50,000 in income in the first year and $200,000 the second.  Your father’s friend is excited about your progress and does not expect the money back soon. Since you did not distribute any money back to your father’s friend, you are not worried about his tax liability. You don’t like paying all the taxes, so you decide to call his money a loan, to deduct interest expenses to reduce your taxable income. What can go wrong?

LLCs for nonresident alien partners

The first issue to understand is that while the US government offers its US taxpayers an easy way for small businesses to avoid corporate income taxes through the use of an LLC, it does not extend that privilege to nonresident aliens. Therefore, while it is possible for a nonresident alien to operate out of an LLC, the Internal Revenue Service has made it very burdensome and expensive for foreign partners to do so.

You may believe that your father’s friend is a passive investor and just provides the money, while you run the business. While that might be the case, such a position would be very disadvantageous from a tax perspective. This is because the IRS taxes passive investor income to foreign partners at 30% of the partnership’s gross revenue. Assuming that the partnership’s second year income of $200,000 was based on $500,000 in sales, the IRS would tax his 50% share at 30% of $250,000, or $75,000. This tax is not based upon actual distributions made to the foreign partner, but the sales income of the company, so he could be taxed on money he did not receive.  Further, the IRS considers the US taxpayer in a partnership with a foreign partner to be the withholding agent; this means they will go after you to recover the tax liabilities of the foreign partner.

Since the IRS has contacted you, you have decided that it is time to seek professional advice. The first thing a tax professional might do is try to establish that your father’s friend is actually, actively involved in a US trade or business. However, even if there is a clear pattern of engagement in a US trade or business by your foreign partner, the IRS may still claim that, because you did not file the correct forms in the first year, you are no longer eligible for the more advantageous tax treatment. This could occur if your father’s friend invested in you through a foreign company and did not file a form 1120-F, US Income Tax Return of a Foreign Corporation.

If it can be established that he is engaged in a US trade or business, he will be taxed on his “effectively connected income” (ECI);  ECI is taxed on a net income rather than a gross income basis. This would allow him to claim deductions for the partnership’s business expenses. But, he will still be taxed at progressive individual tax rates of up to 39.6%. This approach will make his total tax bill around $21,000, saving him nearly $54,000 in taxes.

As you can see from the hypothetical above, international tax is very fact-specific and becomes complex very quickly. It is not only advisable to seek professional tax advice; but, in fact, the IRS expects and requires you to do so whenever you encounter complicated tax issues.

In Part 2 of this article, I will discuss important withholding tax issues for the nonresident alien Partner.

Guest post by Deniz Kiral, a former Big-4 Certified Public Accountant, specializing in international taxation with over 20 years of work experience in the field.

 

What is Spousal Maintenance?

Sunitha Anjilvel

Often known in some states as “spousal support” or “alimony”, spousal maintenance is money paid by one spouse to another upon separation or divorce. Spousal maintenance is not the same as child support; it is meant to support the spouse. However, a court could look at existing child support obligations as a factor in determining a fair award of spousal maintenance.

Spousal maintenance is not mandatory in Washington State

Spousal maintenance, unlike child support, is not mandatory in the State of Washington; a court may order it if it determines that it is “just and equitable.” There are no hard and fast rules as to what is just and equitable, however the court may consider among other things such factors as:

  • the needs of the spouse seeking support
  • the ability of the other spouse to pay
  • the length of the marriage
  • the standard of living maintained during the marriage
  • the existence of any child support obligations

Spousal maintenance may be short- or long-term

While the courts have fair discretion in determining whether spousal maintenance is granted, in short-term marriages maintenance awards tend to also be short term. Similarly in long-term marriages where one spouse might have not worked or pursued a career, a court might grant a long term award. Courts might also grant “rehabilitative maintenance,” an award of spousal support that allows one spouse time to become economically self-sufficient.

Awards for spousal maintenance do not follow a formula

The law surrounding awards of spousal maintenance are, like many other types of family law, not completely set in stone. While the courts may follow general principles outlined above, the law is constantly evolving and expanding. Unlike child support, which is governed according to a specific State Schedule, spousal maintenance has no formula relating to income that guides its application.

When to represent yourself in a divorce or other legal action

Whether you are a spouse who is leaving a marriage and want to know whether you can seek spousal maintenance from your spouse—or whether you might be obligated to provide spousal maintenance—it is a good idea to consult a family law attorney so that you know your potential rights and obligations.

Divorce in plain English

Sunitha Anjilvel

The legal system can seem confusing to non-lawyers. Laws and legal documents based on those laws are drafted using legal terms and language that is known mostly only to lawyers or legal professionals. In this article I explain in plain English some legal terms relating to divorce.

Divorce = Dissolution

In the State of Washington a divorce is called a “Dissolution.” One of the final legal documents that you will obtain from the court is called a Decree of Dissolution. When this document is finalized, your marriage is officially ended.

“No Fault”

Washington is a “no fault state”, which means simply that to get a divorce or separation you don’t need to prove that either spouse did something wrong. In fact contrary to what many believe, wrong-doing by either spouse is never relevant as grounds for a divorce in Washington. A spouse’s actions or wrong-doing can be relevant in deciding issues relating to custody, visitation, and even division of property in certain circumstances, but in terms of the dissolution of the marriage itself fault is never an issue.

Grounds for divorce

There is only one ground for dissolution in Washington and it is that the marriage is “irretrievably broken.” What does that mean? It basically means that one of you is claiming that the marriage cannot work anymore. In your Dissolution papers you need do nothing other than make the statement that the marriage is irretrievably broken. No proof or details about the reason are necessary.

What is a “community property” state?

Washington is what is called a “community property” state. What this means is that when dividing property of spouses upon dissolution there is a presumption that all property acquired during the marriage is jointly owned 50/50. Property includes earnings of each spouse, real estate, and personal property. This rule is not absolute. Certain property is presumed to be “separate”, and includes anything acquired before marriage as well as gifts or inheritances that are made explicitly to one spouse alone. While the rules relating to what is community property and what is separate property are guided by these principles, the overriding principle regarding division of property upon dissolution in the State of Washington is that it be “just and equitable.” In a word, fair.

Custody of children

In Washington, the custody of children of the marriage is referred to as “residential placement” and the document governing where the children are to reside is called a Parenting Plan. This must be filed in all Dissolutions involving children. A Parenting Plan will, among other things, spell out where the children will reside, whether one or both parents get to make decisions about the children, and provides a schedule of how parental time with children is specifically allocated. The Primary Residential Parent is the parent with whom the children spend more than 50% of their time.

Determining Child Support

Child Support in Washington is determined legally by the Washington State Support Schedule. The Schedule provides formulas using combined incomes from both parties to determine how much child support will be paid by one parent to the other. For combined incomes below $5000 the court has a presumptive amount that it may set. For incomes above $5000 the court has an advisory amount that it may set. The court may deviate upward or downward from presumptive or advisory amounts according to the circumstances of the case if it deems it to be fair.

Spousal Maintenance (Alimony)

What is commonly referred to as alimony is called “spousal maintenance” in the State of Washington. Spousal maintenance is not a given: If it is not agreed to and it is asked for, it will be determined on a case-by-case basis with the court balancing one party’s need with the other party’s ability to pay. The court will look at, among other things, the length of the marriage and the economic circumstances of each party. Read more about spousal maintenance in Washington State.

Save money in legal fees – forewarned is forearmed

Sunitha Anjilvel

As a client you want your attorney to give you the best quality representation for a price that doesn’t break the bank. Being a smart consumer about your legal services can help you cut your costs. In this article I discuss how you can maximize the value of legal services provided by your lawyer.

“How much is this going to cost?”

A big question on everyone’s mind when they go to see a lawyer on a matter is “How much is this going to cost me?” You are entitled to, and should, ask this question up front. A lawyer’s pricing structure should be clear—lawyers often charge by the hour or sometimes they have flat fee agreements if the matter has a definite end point (drafting a document such as a contract or will for example). Another option is for lawyers to take cases for “contingency” fees, that is, the client pays no money up front but the attorney will receive a percentage of any money that is won in an eventual lawsuit. However an attorney chooses to price a case, that pricing needs to be fully explained to you before you sign any agreement with the attorney for representation.

Complex cases can be difficult to estimate

In cases involving complex contested issue, a precise answer as to what a case will cost is more difficult to give. The answer “It depends” is not a satisfying one. Nor should it be. While no attorney can see into the future in matters that may be hotly argued it is reasonable for a client to ask for an estimate of what a matter would cost if it were to go to court.

Be an active participant in your representation

While you may not understand the intricacies of the law as it affects you, you can think about your situation and what might be acceptable outcomes for you before you consult with an attorney. In a family law case particularly when it comes to division of property, you might want to think about what issues you feel could be settled or agreed to off the bat. It is a simple truth that conflict in the legal world is costly for a client. If there are issues to be agreed upon you should consider them first if you can and consult with an attorney to make sure that what you are agreeing to is fair and reasonable. If some conflict is unavoidable it is still possible to isolate issues that can be agreed on saving you expense and time.

Issues facing separating couples: When to represent yourself

Sunitha Anjilvel

When should you attempt to go through the divorce process without an attorney? Two key questions you have to ask yourself are:

  1. Are you aware of what the outstanding issues are?
  2. Are you and your spouse in agreement about all these issues?

If the answer to both questions is yes, you may be in a position to go through the divorce process by yourself. If you are dealing with complex issues, you still might want to contact an attorney during the process of your separation in order to be sure that you have not missed anything. In this article I will discuss some of the major issues facing a separating couple.

What happens to the children?

In Washington State, issues relating to children are outlined in a legal document called a Parenting Plan. For all matters relating to married or unmarried couples with children a Parenting Plan must be entered with the court. This document deals with where the children live and what the children’s schedules are in terms of weekends, holidays etc.

In Washington the courts talk about “placement” rather than custody when it comes to children. The decision as to who gets primary residential placement is determined by the amount of time the child or children spend with one spouse. Usually if the children reside more than 50% of the time with one parent, that parent will have the designation of primary residential placement. Although one parent may have more residential time than another this does not mean that parents cannot share joint decision-making powers about things such as medical care, schooling etc. A Parenting Plan will define how these powers are allocated. The guiding principle in all matters relating to child custody and visitation is “the best interests of the children”.

Child Support

Child Support in Washington is based on a set of presumptive guidelines according to the Washington State Support Schedule. The Schedule provides formulas using combined incomes from both parties to determine how much support will either be set on a presumptive or an advisory basis. For combined incomes below $5000 the court has a presumptive amount that it may set. For incomes above $5000 the court has an advisory amount that it may set. The court may deviate upward or downward from presumptive or advisory amounts according to the circumstances of the case if it deems it to be fair and in the best interests of the children.

Spousal Support

What is commonly referred to as alimony is called spousal maintenance in the State of Washington. Spousal maintenance is not a given: If it is not agreed to and it is asked for , it will be determined on a case by case basis with the court balancing one party’s need with the other party’s ability to pay. The court will look at, among other things, the length of the marriage and the economic circumstances of each party.

What happens to the house?

If you and your spouse own a home outright or on which you are paying a mortgage, on separation a decision must be made as to what to do with the house. If the down payment and subsequent payments on the home were made through the earnings of either spouse while living together, then the house might be considered “community property” which means that each spouse has a presumptive 50/50 interest. The house could be sold, with the proceeds going to pay off the mortgage first, then a split would be made to divide what is left over equally between the spouses.

If one spouse wanted to stay in the house, an equal division could involve the spouse who keeps the house paying off the other spouse for whatever portion of equity remains in exchange for signing a quit-claim on the house. A quit-claim is a legal document that gives up a person’s interest in a piece of property.

These are just a few options regarding division of a home. Parties are free to agree to any division as long as it is “just and equitable.”

How are other assets and liabilities divided?

As a “community property” state, in Washington there is a certain set of presumptions about the division of property acquired before and after marriage. Presumptively, property acquired before marriage and gifts and inheritances to one spouse alone would remain the separate property of that spouse upon separation. Property acquired after marriage, including earnings from employment, are presumptively community property and subject to a 50/50 split. This presumption, however, can be overcome if it can be established that it is just and equitable to do so.

The allocation of debt is also subject to community property presumptions based on whether the debt was incurred during the life of the marriage and before separation. Again, courts will also consider whether the allocation is just and equitable.

Affordable divorce in Washington: Unbundled Legal Services

Sunitha Anjilvel

For many separating couples, the emotional trauma of actual separation is further complicated by the potentially devastating economic consequences of splitting one house into two. Add large legal bills to this situation and you have one reason why many couples are actually choosing to stay together purely for economic reasons. How is it practically feasible to get a divorce without spending thousands of dollars while still making sure that your divorce papers are in order?

A different model of legal service

Think of it as separating out or “unbundling” the various legal tasks involved in the divorce process to get the most cost effective services from an attorney. If you learn that starting the divorce process involves filing, say, five documents you might go to an attorney for advice and assistance in preparing those documents to be filed with the court. The attorney might not actually go to court with you, however he or she will ensure that all documents are appropriately ready to be presented to the court. You could continue to pay that attorney for their time to assist you in further filings and preparations of documents. While you would be representing yourself on the record, you would under the guidance of an attorney, be doing so in an informed way and be saving yourself many billable hours of legal fees.

Another type of unbundled legal service might be a matter where an attorney provides a “limited scope of representation” in a particular issue. The attorney might step in to negotiate one aspect of your case even if the other side were represented by an attorney perhaps to reach a settlement.

Are unbundled legal services always appropriate?

Unbundled legal services are not always the best option in every case. These services might not be appropriate in a situation where the other side has an attorney who is representing them and the issues are highly complicated and contested. It requires you as a client to be an extremely active participant in your case and to be prepared to do some footwork in terms of court filings if you were to represent yourself. It is an option that works best where the issues involved can be agreed upon.

Preparing for end-of-life: 3 important documents

Sunitha Anjilvel

No one wants to think about catastrophic illnesses or end of life issues. But for your care givers and loved ones, a set of simple documents can be prepared to avoid confusion about what you would want to do medically should you become unable to speak for yourself. In this article I discuss three types of documents used in Washington State that will help you make sure that your end of life wishes are carried out in the way that you desire. These documents can be drafted and stored in the Washington State Living Will Registry (website) so that your wishes are preserved.

Decide for yourself how you want to manage end-of-life issues

In the State of Washington a Living Will, or Health Care Directive, is a legal document used under two circumstances:

  1. When you have a terminal condition and life sustaining treatment would only prolong the process of dying, and;
  2. Where you are in an irreversible coma and there is no reasonable hope of recovery.

By specifying what your wishes would be in a living will you can direct your own medical care at the end of your life.

“Who will make decisions for me when I can’t?”

Another important health care document that everyone should have is called a Durable Power of Attorney for Health Care, or Medical Power of Attorney. This document lets you name a “health care agent”, a person who you trust who is authorized to make medical decisions for you regarding treatment if you become unable to make those decisions for yourself.

Make your wishes known to your health care provider

The Physicians Orders for Life Sustaining Treatment (POLST) is a form signed by your physician that takes your wishes as expressed in your living will and medical power of attorney and provides clear directions for medical orders regarding such specific medical interventions as antibiotics, fluid and nutrition, and life sustaining treatments should you become incurably ill.

Preparing these documents in advance ensures that in the event of a medical emergency or crisis your wishes will control the situation and you will lessen the stress of those around you.