Dallas Divorce Law Blog by Michelle O'Neil

In a July 31, 2009 opinion by the Dallas Court of Appeals, it was confirmed that Federal law trumps Texas law when it comes to income tax issues.  In In re S.L.M., the mother brought child custody proceedings against father.  The district court appointed mother and father as joint managing conservators and awarded mother the right to claim the children as exemptions on her federal income tax return. On appeal, father contended the district court erred in awarding mother the right to claim the two children as tax exemptions.  In re S.L.M., ___ S.W.3d ___, No. 05-08-01277-CV, 2009 WL 2343264 (Tex. App. – Dallas July 31, 2009, no pet. h.).

The Dallas Court of Appeals held the district court erred in awarding mother the exemption rights and examined tax exemptions under the United States Internal Revenue Code.  In computing taxable income, a taxpayer is permitted to claim dependents as exemptions and the exemption is awarded to the custodial parent as the parent having custody of the child for the greater portion of the calendar year.  Id. at Sect. 152(e)(4).

When applying the pertinent provisions of the tax code to the facts, the court determined that father had greater periods of possession that mother and as such, should have the right to count the children as exemptions on his tax return.  As a Dallas divorce lawyer it is important to stay on top of not only family law developments but developments in other areas that impact family law.

The Texas Legislature has adjourned and made some changes to the Texas Family Code.  One of those changes involves the Texas Standard Possession Order.  As a Dallas Divorce Lawyer, I think it is important to know these changes. Keep in mind that the Governor has not signed the bill yet; so, there remains the possibility that he may veto the bill, although I do not find that likely.

HB 1012 clarifies the default time for the beginning and ending of a possession period to be 6:00 p.m.  Prior to this clarification, there were placed in the Texas Standard Possession Order that did not specify an exchange time or were unclear.  This makes it clear that the default time is 6:00 p.m. unless there is a specific statement otherwise.  To overcome this default time, a conservator may request the court to impose an alternate beginning and ending time, such as beginning at the time school is dismissed for the period of possession.  The court must accept the request for the altered time, unless the parent opposed to the time change shows a reason it is not in the child’s best interest.

Note, the parent making the election must do so when the order providing for the possession schedule is rendered. That means that the possession schedule will be set in stone (subject only to the agreement of the parties to deviate) when the order is entered.  Neither parent can make an election to change the time of exchange later.