Opinion ID: 1966373
Heading Depth: 1
Heading Rank: 4

Heading: Tax Ramifications

Text: The defendant contends that the trial justice erred in failing to consider the tax ramifications associated with the need to liquidate assets to pay plaintiff her share of equitable distribution. Specifically, defendant avers that the trial justice should have considered the capital gains tax defendant would incur if forced to sell property to satisfy the equitable distribution. A trial justice's decision to take into account tax [consequences] applicable to a property distribution is committed to his or her sound discretion. DiOrio, 751 A.2d at 752. However, sufficient evidence first must be adduced at trial to guide the [court] in the reasoned exercise of that discretion. Id. The defendant failed to submit any evidence to guide the trial justice in assessing the tax implications of any property distribution. The only mention of taxes occurred in defendant's proposed equitable distribution in which he stated that the trial justice should consider the capital gains tax that the [d]efendant will have to pay if he is forced to sell [the commercial property] in order to satisfy the equitable distribution. Such hypothetical and general statements clearly do not trigger the need to consider any tax ramifications. The defendant did not show that he would be forced to sell the commercial property, nor did he outline any potential tax consequences. Without such evidence, the trial justice effectively would be operating in a judicial vacuum, dealing with complex issues beyond the ordinary ken of his or her duty and ability as a fact finder. Id.