Quasi/ Income from SP Flashcards

1
Q

stock options

A
  • when granted to an employee, a stock option is considered compensation
  • granted in lieu of or in addition to a salary
  • requires vesting (usually over a 3yr pd)
  • option gives employee right to buy shares in the co. at a particular price on or before a particular time (typically 10 yrs)
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2
Q

inception of title- stock option

A
  • if the vesting period accrued during marriage, that part of the option is CP
  • if any part of the option accrues after or before marriage, that portion is SP
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3
Q

Trusts

A
  • Present possessory right to the corpus of the trust
  • allows a B to enter the trust at will and take trust principal
  • trust income that could have been taken by the B is treated as CP
  • B has rights to reach the corpus that determines prop rights in a divorce case
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4
Q

Continuing Gift Theory

A
  • get trust as a gift

- trust assets are sep prop, but interest and dividend distributions are CP because they are income during the marriage

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5
Q

mineral interests

A
  • considered RP interests
  • payments for a royalty or working interest are SP if the underlying interest is sep prop
  • exception: delay rentals are considered CP
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6
Q

livestock and crops

A
  • when SP livestock produce offspring, the offspring are treated as CP
  • proceeds derived from crops are CP
  • proceeds from the sale of lumber are Cp
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7
Q

Quasi-CP

A
  • married couples were living in common law states, moved to TX, and are seeking divorce in TX
  • base on prop situs at acquisition
  • out of state prop is treated as Q-CP if it would have been CP in TX, had the spouses been in TX at the time they acquired it
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8
Q

Assets purchased with credit

A
  • when a spouse borrows money during the marriage, the C estate is obligated to pay the debt
  • assets acquired by a debt incurred during marriage are C assets
  • exception: creditor can agree to use only one spouse’s S estate for repayment
  • can be overruled by agreement
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