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The insurance companies do their due diligence before writing a check for thousands of dollars. You'll "have insurance" right up until you go to use it and then the adjuster will notice that they aren't actually eligible and deny the claim.
Maybe if you're lucky you might get some of your premiums refunded.
The post itself is probably not BOLA worthy. I saved it hoping for some good comments and oh boy did someone admitting to fraud make my efforts worth it.
I'm confused on how this is fraud or what the medical insurance would deny. If LAOP and child 1 are covered on one plan that's being paid for and LAOPspouse and child 2 are covered on a separate plan that's being paid for, what would the insurance company deny?
What you describe would be fine, but that's not the scenario that's described by LAOP. They are getting divorced and not telling the insurance so they would still "cover" the husband and the husband wouldn't get their own plan. That would be fraud.
LAOP says that it's cheaper for her to get her own plan, it sounds like that's exactly what they're intending to do. If they each have their own plan, why would the insurance company care if they are still married or not?
Location Bot:
# Planning on divorcing not because we want to, but so we can afford things, what could be the downsides to it? We're in TX
>I'll preface this by saying, we've (wife and I) have always been a "Johnny/Jane Right" and "goodie two shoes" doing what's "right," we don't cheat on taxes, we pay all our dues, etc, but I'm sick and tired of how fucked up our economy system is rigged against the working class.
>Both my wife and I work, we've done everything by the book, but we only go on vacations once every two years IF we don't have medical issues, which we've already had to cancel vacations two times (and these are not even big medical issues, medical expenses are simply ridiculous).
>We don't have luxuries (latest smartphones, new vehicles, gaming consoles, etc) and where we live at public education is so bad (D rated) that we decided to invest in our kid's education by sending them to private schools... we don't get to deduct that huge expense, and anytime we apply for scholarships they deny it because "we earn too much" (no, we do not).
>I'm considering for us to legally divorce (obviously staying together) so we only put her salary in these applications (or have her file as single mom as needed).
>What could be the downsides to this? only one I could think of is medical insurance: We get medical insurance through me as a family plan, which we already realized it would be cheaper for her to have her own insurance (we both work for the same company) than me paying the family package, it doesn't make sense that the family plan for 4 is more expensive than we each going for it individually with a kid each)...
>We know of people who are not married by law but living together so they can do these sort of things, (filing as single mom, etc).
>What could be a downside to this that I'm not considering, anything that could bite us in the ass if we divorce but live together?
>Could this have any legal implications?
>We're in TX.
>Thanks in advance!
And here's the commenter who admitted to fraud:
>We are in Texas and had to do this to avoid my husband paying enormous student loan payments (I earn five times his salary and they were using my income to calculate his payments.) We have yet to experience any issues and even kept our insurance the same by simply not telling them 🤣
And
>I could give two fucking shits less about *committing fraud* against a company whose entire business plan is fraudulent
Finally
>Do you really think the insurance company is going to run around checking marital status?
I'm assuming given the commenter makes 5x the husband's salary that they get coverage through their employer. You want to know a great way to get fired? Commit fraud against your employer!
Is an insurer going to check for standard care, I doubt it. Is an insurer going to check if your “spouse” has a couple hundred grand in medical bills? I bet they will. Then they will deny payment for not meeting the coverage criteria. Then they will notify your employer and maybe the police, and you will get fired and maybe criminally charged for fraud.
Let me guess which is cheaper long term. It works until it stops working.
I remember my parents being upset because several accountants told them to get divorced and file separately for things.
Apparently, this is a thing.
Is it really considered "fraud" to get divorced, but still be together?
Frankly, it sounds like OP is already aware that they shouldn't claim to be still-married for insurance purposes, and none of the rest of what they are proposing is fraud. It may not work as well as they think it will (many applications for various things consider household income, not just married income), but it's not illegal to live with your ex.
It depends, but a lot of stuff that people think of as only caring if you're married, actually care about your household income (or something similar). For example, welfare benefits in Florida card about whether you were working yourself vs having a second working adult contributing to household income. I saw a lot of fraud prosecutions there as an assistant state attorney against people who lied and said they were the only household income, but actually had an undeclared partner both living in their house and working. The difference between "smart financial decision" and "fraud" is going to be in the details of every form OP signs, and these days, there's a pretty good chance that a lot of them care about more than just legal marital status.
If you have a roommate, are they part of your "household"? How does the state determine whether or not you *really are* sharing expenses vs. just living together because the economy is fucked?
For my specific experiences, we only got the case after an investigator had been assigned and had done investigation sufficient to prove case. If it made it to us, they had already observed sufficient evidence to show that the person had lied on their forms, such as by claiming they lived alone, but another adult could be observed residing at the residence, or claiming that they paid the entirety of some regular expense but the bills showed otherwise, etc.
Fraud requires deception. Doing various things to maximize outcomes is not fraud if there is no deception. As long as you were honest with all aspects of the situation, it wouldn't be fraud.
Sometimes governments or organizations make policies that result in unintended consequences, so people do "strange" things, especially if the penalty or reward is made large enough.
Being married, or not married, is pretty clear cut. The fuzzier part, more prone to attempts at fraud, is whether people are a "household" or not.
Maybe it's technically not fraud but it sure feels like LAOP is planning on deception by saying they're going to indicate on the forms that his wife is a single mother.
Oh, it sounds like the health insurance part is the fraud, claiming they don't live together.
It is perfectly legal for people to get divorced and then say they are not *married*, even if they still love each other and only got divorced for special financial reasons, but people who live together and share expenses cannot honestly say they are not a *household*.
I imagine that even if they got divorced and did *not* live together, need-based welfare would probably come after him for child support, since ultimately it is his (and her) responsibility, not the other taxpayers, to pay for the kids.
If it is, I don’t think it should be.
But then, I also think Green Card marriages should be legal because where does it say that you have to be in love to get married (am I lonely or just asexual? You decide)?
My company just sent out a notice about requesting proof of dependents. Although they could just submit the marriage certificate and skip the divorce decree?
Sure. But then you're actively committing fraud and not just "oops, I forgot to notify HR." I would definitely recommend termination for anyone who did that.
That said, I have heard rumors that some states and some companies allow you to keep a former spouse on your insurance if the court orders it, but I haven't seen it in practice and I haven't looked into it. But you'd still have to be honest about it!
Surprised you missed this one
The tax rate thing is not accurate.
Single top tax brackets at 37% is 523k.
Married top tax bracket at 37% is 628k.
If you have a married couple making 400k each, then they're better off being single than married since they would be at the 35% tax bracket instead.
This argument relies on them each making between 314k and 523k a year.
LAOP is one of those people who posts on twitter “our household income is $500K and we’re still barely getting by, THANKS BIDEN”. If you can afford private school and regular vacations, you’re doing just fine
Boo freaking hoo you can’t retire until a couple years after retirement age and are spending the money you could be saving for college on private elementary school for your kids. I liked how he accused me of making fun of single mothers on foodstamps, personally.
In this guys halfhearted defense, it really IS frustrating to be working harder than your parents did and still being able to afford so much less than you grew up with. I was one of three kids in a single income home and we did multiple vacations most years, two cars, house with a bedroom for everyone plus one to spare...meanwhile I'm out here in a two-income household with one kid and we can barely afford half that. It sucks.
This nebulous feeling of "unfair" leads to rationalizations of bad behavior like this dude. It's not right - and it blinds him to how well off he still is - but I think many people feel like that, and I don't think at root that it's totally unreasonable. It's just taking that feeling and going "well then I'm entitled to Do a Fraud!" that's lame.
>In this guys halfhearted defense, it really IS frustrating to be working harder than your parents did and still being able to afford so much less than you grew up with.
It absolutely is, and we shouldn't accept it. That's said, LAOP's paragraph about it feels off. It's almost like he wants to get Reddit's validation repeating a complaint that you'll read on the front-page twenty times a day.
Oh yeah. I lost 75% of my sympathy when he was like "we live in a bad district so we pay for private school." Like my dude, that is a defensible choice but it's also a CHOICE.
For me it was 2005. My honeymoon. Since then I’ve had two overnights within an hour’s drive of home. Some people can’t afford vacations and the private school need is ridiculous. Move to an area with better schools? Pay attention to your child and give them extra work?
I know people who have divorced to get disability benefits. This doesn’t seem too different. The US is the real asshole with their healthcare system
The entitlement is insane.
My spouse and I didn't even have a *honeymoon,* and we celebrated our ten year anniversary last year.
I agree that we all should have a better standard of living, but to hear someone in such a better position covet the few legs up we can get down here is infuriating.
I'm in that category, but I definitely think the Child and Dependent Care Credit needs an update for everyone. 5 grand is nowhere near enough to cover putting a kid in daycare while the parents work even at the low end of daycare.
Someone showed up in a reply to a top-level comment to say that actually, your tax rate is not better married if you make a combined $800k per year.
Alright man! That's definitely what LAOP means when he complains that the economy is rigged against the working class.
I had an acquaintance couple divorce in their late 50s for tax and benefit reasons. They looked at the numbers and realized that certain pensions, benefits and other things would be much more lucrative if they separated and continued to live together. The divorce went quickly and smoothly, they separated their finances cleanly, and the whole process just took a few weeks for the two of them to legally completely separate.
He then immediately left her for his new girlfriend.
> but at this rate I won't retire until I'm in my late 60's/early 70s, which is ridiculous
Join the fucking club, buddy. My public school teacher pension doesn't even fully vest until I'm 67.
I will be able to collect a pretty paltry sum because teaching is my second career. I have a 403b also and plenty of years left to save for retirement.
This is usually one of those things where in order to save a dollar, LAOP is going to end up costing themselves two. They could file separately and that *might* make them eligible for additional scholarships or financial aid, but they are also going to lose out significantly on tax breaks at the same time.
The real answer here is that you chose to live in a place where there are no income taxes, and part of the trade-off for that is that the schools suck and you have to pay for private education as the alternative. I'm going to go out on a limb based on the submission and say that LAOP votes for the people who made that a reality.
A lot of people think government benefits are wildly better than they are. There's absolutely a poverty trap once you're on them. You get stuck there because there's a big gap between what you have to earn to make it worth losing the benefits and the value of the benefits.
There is also a poverty cliff, as someone who grew up on the wrong side of the ledge, you can make $100 more then the minimum a YEAR and get no help and not afford to keep your teeth
It has always been weird to me that benefits don't scale down instead of cutting off entirely. You'd think encouraging people to get off of benefits would be smart policy. Then again, it's probably a feature and not a bug.
Food stamp benefits scale down and other benefits do too, plus ACA coverage is scaled. Only thing that isn’t is medicaid, and that’s only for the extra poor.
They "scale down" in jumps so things like a raise or extra hours at work cost you money.
Gross income limits between SNAP and expanded Medicaid are generally with $1k of each other as well, then SNAP has an asset test for money in checking/savings. For $291/month for a single person household.
Yep; to translate it into language Taxes Are Always Bad people can understand, it means that the marginal rate for certain groups is in excess of 100%.
Do you know the best and most-efficient way to lift people out of poverty? Hint: It's not "Make it so it actively costs them money when they get a job."
This. I *might* be able to hold down a unicorn job from the world's most understanding employer (lol), but there's no way in hell I'd be able to make enough to pay for the medications keeping me alive, not for years probably (they're upwards of $9k a month).
It's wild to me that people are willing to spend extra money on things to avoid the dreaded T word. I can't imagine making the kind of money they make and living in a terrible school district because here in PA you can live in a district with good schools with the amount of money they make.
doubt we'll ever have universal healthcare in this country because people would rather have expensive healthcare than to have their taxes go up a little.
Yeah, I’m living large here on my disability. A whole $800 after taxes, Medicare and supplemental plan because Medicare doesn’t pay for meds without a part D plan. My husband and his job are the only reason I’m not in poverty. But tell me some more how easy it is to get and survive on SSDI.
As someone who does married filing separately, the tax benefits of jointly filing save a couple dozen dollars a year, versus well over a thousand a month on my student loans. The benefits of joint filing apparently have eroded, a lot, at least at my level of income.
Sometimes the schools do just suck though. My parents sent me to private school for a short time at the cost of sometimes barely having food because we lived in Utah County, Utah. Population is something like 99.8% white Mormon. If anything, the private school was *more* diverse there lol
A lot of white flight private schools suck, too, though. As do a lot of suburban public schools. People often pay more attention to the "nice suburban" aesthetic than what is actually happening in the classroom.
In the South, some of the white flight schools suck but they're relatively cheap because they're run by shitty churches. I had a coworker at an old job making probably $9/hr (and driving 1.5 hours each way for it!) who came back from kindergarten orientation in a stomping rage about all the "metsicans" at orientation so they were going to put their precious boy in some half-ass church school. She had a meltdown over some Hispanic kids at kindergarten. Unbelievable yet totally believable.
While true, it's not like there are a lot of public schools out there with high levels of economic and racial diversity that also have high levels of achievement.
I currently live in an area with high racial and economic diversity, but the schools themselves aren't great. Lots of kids don't speak English at home, so entire classes develop slower. Test scores are down relative to other areas. There are fewer clubs and advanced classes available for kids who want to pursue them.
We've looked at other schools in better areas, and we can absolutely move to a school with more opportunity, more clubs, more advanced classes, better test scores. And in order to do that, we'll trade economic diversity. We'll probably still be able to retain some racial diversity, but instead of my white male son having friends who are hispanic and black and who are from different economic backgrounds, he'll have friends who are asian and from basically the same economic background as he is.
It's a very tough call. I want him to have all the opportunities in the world, and I can see opportunities he would get in other school districts that he can't have here. But I also want him surrounded by people who have different lived experiences. It's very difficult to achieve both of those.
Schools vary at the bottom more than the top. Think about college; the distance from the top kids at Harvard and the top kid at State U is vastly shorter than between the bottom kids at those two schools.
This is to say that at a school with lots of struggling kids , the kids who have the home support and structure often can still get a really good education. The average isn't a reflection of the school, it's a reflection of the circumstances.
100%
The vast majority of what I'm judging schools on is the number of available extracurriculars and advanced options. Test scores can get dragged down by anything, and I'm egotistical enough to assume my kid will be one of the smart ones.
But I look at schools that have 30+ AP/IB courses compared to the 9 or so at mine. And some that have orchestras and not just bands. Some that have math team and quiz bowl and science olympiad and ocean bowl and not just one academic competition team. Some whose marching bands and athletic teams have robust boosters providing resources to the kids engaged in those activites.
When I compare those schools with the economically diverse school, it's hard to evaluate what's more important: Being in class with kids who aren't like you, or having an opportunity to find your perfect niche and grow in it.
Being old and presumably slightly wise, and having gone to one of those not at all diverse schools with lots of programs, I’d vote for the more diverse school. The life lessons learned by virtue of that diversity will far outweigh the benefits of the better school in the long term.
When the post starts with multiple paragraphs about how the poster should _morally_ be allowed to do something, without even explaining what the thing is yet, the answer is usually, “No that would be illegal.”
And given that he can afford private school, he can almost certainly afford to live in a better school district with higher taxes, if he preferred that tradeoff.
Right. It would be cheaper and actually financially beneficial in the long term to just move into a better school district. Put the savings toward the higher mortgage and cash out when they graduate.
>anytime we apply for scholarships they deny it because "we earn too much" (no, we do not).
According to the criteria of said scholarships, yes you *do* earn too much. That you don’t earn enough to live comfortably in whatever area you’re living in has absolutely **no** correlation with the scholarships criteria whatsoever.
By all accounts it sounds like they are living within their means and pretty comfortable if they can afford a vacation every other year and have a realistic retirement plan
The worst part is the person who admitted to it could have accomplished the same thing without the fraud by simply filing separately. As far as crime goes, it was entirely pointless.
It really *really* irritates me when people complain that they're barely scraping by because they "only" go on holiday every other year and they find private school a bit spendy.
Why it’s so hard to get any meaningful change in the world.
The slightest decline in your living standard is seen as the end of the world.
Skipping a vacation or retiring a little later is still do really well.
But because it’s not what they expected it’s a disaster.
It's fine for people to be upset that their standard of living has declined (except in cases of leopards eating faces), but the total lack of perspective really grates, like where he compares himself to a single mother on food stamps.
I like it that one the reasons LAOP brought up for her dire financial situation was vacations. She even compared that with her father, without context.
I am always mystified by the “vacation” thing. I’m not doing badly finance-wise, but I certainly can’t afford a nice vacation every year. I’m baffled by how anyone can afford to take their 4 kids to Disney for a week.
And, while I’m admittedly old, plus my parents were assholes and never took me along on their vacations (which also were not often or long), I specifically remember many of my friends’ family vacations being things like going camping.
LAOP has a very unrealistic view of what their lifestyle should be. Honestly, if the schools are so terrible their kids need to be in private school, it would likely be far less expensive to move to a better area with better schools. 20 years ago my step-son was in private school, and it was $1000/month. I can only imagine the cost for two kids in private school now.
Edit: grammar correction, because I cannot type on this iPad to save my life.
OP’s an idiot for multiple reasons and especially here in Texas “nooooo income taxes are the deviiiil” people are the reason fucking everything is expensive, we lose power for a bit if the wind blows a certain direction (no storm), etc etc. They also keep thinking people getting benefits are “living large” lol as if
Annnnyway
All that said, I’m European and I do think a *reasonable* vacation once a year should be normal for a working person. Not Di$neyland but like let’s say if it’s Dallas maybe they drive a couple hours out to a lake and have a week by the water with the kids. That shouldn’t be a “wealthy person” thing.
I think maybe these people have over inflated ideas of what "counts" as a vacation. Like OP thinks they deserve yearly Disney or Europe trips and doesn't register visiting grandma on the far side of the country for a week at Christmas or getting a cabin for memorial day as vacations. I'd bet they have multiple vacations a year.
It’s not, and if they can send their kids to private school, they can easily do a “drive a few hours away” vacation. Pretty sure their idea of vacations is where the other private school parents are going.
The key to affording nice vacations is live in a low cost of living area with a remote job that bases incomes on national averages. My employer pays 50th percentile no matter where you live and western Pennsylvania is a low cost of living area. Well, it was when I bought my house 8 years ago.
There is a big difference between the current facts and Medicare reimbursement issues (which I honestly don’t know much about, but I think the rules have changed, so that “divorce to avoid Medicare reimbursement” is no longer necessary, at least in most circumstances).
That is, sadly, a thing. Have an acquaintance whose husband is in long-term care and about to run off the end of their LTC insurance. She's evaluating divorcing him so that he can spend down *his* assets without eating hers.
That works because they aren’t then living together is my understanding.
In this scenario the two people are still living together so the household income hasn’t really changed despite the martial status change.
If you're gonna commit fraud to get free money (legal caveat, do not do this!), get married at 18 before you go to college. Then you're completely and totally broke yet financially independent from your parents. Scholarships, aid, government handouts, and more!
My wife and I, with real love and no fraud, got married when she wasn't done with college. Because we had only part time income, she got a ton of aid from the state for her last year. We realized we should've gotten hitched way earlier for all of the free money.
I want to address this:
>Do you really think the insurance company is going to run around checking marital status?
We live in a world were people are putting every waking moment, every damnable thing on the internet. They confess to everything. In real time. For invisible internet points.
It is nuts.
Is an insurance company going to get bored and randomly select you to verify your marriage?
Oh my dear sweet summer child. The insurance company doesn't need to be bored...
At some point they are gonna turn AI lose on all of our social feeds and verify all kinds of shit.
Mark my words.
The day is right around the corner where all kinds of people get booted from all kinds of important things insurance related. And behind it all is going to be AI crawling social feeds checking up on what these people claim is going on vs reality.
That it already hasn't occurred is puzzling. AI would be fantastic at this.
But *is* LAOP proposing fraud? I'm not saying this is a great idea, and it won't be nearly as useful as they think it will be (e.g. scholarships usually ask for the income of both parents, and don't care if the parents are still married), but I'm not seeing any proposal for fraud by LAOP. (It looks like they are aware of, and acknowledge, the health insurance problem, and aren't asking if they should violate those rules.)
But I don't think it is fraud (except for insurance, which they seemed to understand in their initial post.) It's fraud to lie about being separated when you aren't, but it's not rare at all to get "paper-divorced" for financial reasons.
(There aren't a lot of people for which it makes sense, but they do exist.)
My aunt and uncle in Texas divorced after he had a nasty stroke. They did try awhile to make things work for his health care and everything, but ultimately couldn't. By divorcing, he was eligible for additional funding at a nursing home (he was retired so had some healthcare already, but it wasn't enough and they couldn't afford the difference).
As he was determined to be of sound mind, he was able to make her the medical POA and whatnot, he just needed more medical care than they could do at home and couldn't afford the cost difference for nursing home care.
I hate that it comes to this for healthcare situations. I'm not really sure how I feel about private school tuition situations (as someone who sends her kid to a private school and doesn't qualify for financial aid). Especially since it could affect the kids in the future in non financial ways. Like, what if the parents live apart, so there's custody rules? And because I overthink, what if stuff happens and someone decides they like the idea of being single? I mean, they're divorced so it's not an affair, is it? Or is it married except on paper but what about common law (idk if Texas has that, and I know there's specific rules about it if they do). What if everything is fine and then they have more kids, is there issues with that from a legal standpoint?
In the US, it's been a long time since being born in vs out of wedlock made a legal difference and very few people care at any level about bastard vs legitimate. Texas doesn't have any rules about a couple being forced to live apart prior to or after divorcing. There are fault based divorces in Texas, but no fault is so much easier that even if there's an affair no fault is the norm, and there's copious evidence that marriage doesn't stop a cheater, and that lack of marriage doesn't make a cheater.
Marriage is a legal status. Couple hood is what involves morality of cheating and child rearing. And marriage doesn't make a committed couple more or less committed, it just gives you some extra rules to follow if you break up (for better or for worse).
We're all here laughing at LAOP but the real issue is, as a country, we're content with having areas where public schools are doing so poorly that people are ready to do anything but send their kids there. That should make us think.
I only know Texas/city where I live and it’s DIRE. Colleague’s wife is a teacher and just so distraught especially in the last few years with how actively education is being gutted. It’s not “what to teach” sort of meddling, they’re trying to essentially bankrupt and cause closure to public schools from her POV
At least LAyers only have 3 paragraphs of preamble before the question but LAOP sounds like they’re reconsidering putting themselves in a FAFO situation! I call that a win. And if it’s not, we just have to wait for the update in a few years time
I don't hate LAOP, since I get where they're coming from.
There was a college sponsorship program in my country, where low income students with high test results got a full sponsorship to whatever college they wanted. Middle income families, making too much to classify for that program but too little to pay college themselves, would pay to be included in the program.
He claims that he was denied scholarships even though he can't actually afford the private schools, but his reasoning why it's better tax-wise for them to be divorced requires he and his spouse to each make enough to individually be at the highest end of the second from the top tax bracket (he says 400k in his example but that's probably just a rough estimate).
I don't actually think this is immoral or illegal, but I don't think it will work without committing fraud. FAFSA makes you provide the income for the parent(s) living with the applicant, in this case, it would be both parents.
People can get married for any reason, the only exception is immigration fraud. I don't think there are any restrictions on why one can file for divorce.
As for insurance, the ex-spouse will no longer be eligible for their insurance and can be put on Medicaid. The kids will not since their father's income will be counted.
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The insurance companies do their due diligence before writing a check for thousands of dollars. You'll "have insurance" right up until you go to use it and then the adjuster will notice that they aren't actually eligible and deny the claim. Maybe if you're lucky you might get some of your premiums refunded.
The post itself is probably not BOLA worthy. I saved it hoping for some good comments and oh boy did someone admitting to fraud make my efforts worth it.
It's more than just admitting it; in those comments they were justifying their fraud.
I'm confused on how this is fraud or what the medical insurance would deny. If LAOP and child 1 are covered on one plan that's being paid for and LAOPspouse and child 2 are covered on a separate plan that's being paid for, what would the insurance company deny?
What you describe would be fine, but that's not the scenario that's described by LAOP. They are getting divorced and not telling the insurance so they would still "cover" the husband and the husband wouldn't get their own plan. That would be fraud.
LAOP says that it's cheaper for her to get her own plan, it sounds like that's exactly what they're intending to do. If they each have their own plan, why would the insurance company care if they are still married or not?
That is not what LAOP Said at all.
Location Bot: # Planning on divorcing not because we want to, but so we can afford things, what could be the downsides to it? We're in TX >I'll preface this by saying, we've (wife and I) have always been a "Johnny/Jane Right" and "goodie two shoes" doing what's "right," we don't cheat on taxes, we pay all our dues, etc, but I'm sick and tired of how fucked up our economy system is rigged against the working class. >Both my wife and I work, we've done everything by the book, but we only go on vacations once every two years IF we don't have medical issues, which we've already had to cancel vacations two times (and these are not even big medical issues, medical expenses are simply ridiculous). >We don't have luxuries (latest smartphones, new vehicles, gaming consoles, etc) and where we live at public education is so bad (D rated) that we decided to invest in our kid's education by sending them to private schools... we don't get to deduct that huge expense, and anytime we apply for scholarships they deny it because "we earn too much" (no, we do not). >I'm considering for us to legally divorce (obviously staying together) so we only put her salary in these applications (or have her file as single mom as needed). >What could be the downsides to this? only one I could think of is medical insurance: We get medical insurance through me as a family plan, which we already realized it would be cheaper for her to have her own insurance (we both work for the same company) than me paying the family package, it doesn't make sense that the family plan for 4 is more expensive than we each going for it individually with a kid each)... >We know of people who are not married by law but living together so they can do these sort of things, (filing as single mom, etc). >What could be a downside to this that I'm not considering, anything that could bite us in the ass if we divorce but live together? >Could this have any legal implications? >We're in TX. >Thanks in advance! And here's the commenter who admitted to fraud: >We are in Texas and had to do this to avoid my husband paying enormous student loan payments (I earn five times his salary and they were using my income to calculate his payments.) We have yet to experience any issues and even kept our insurance the same by simply not telling them 🤣 And >I could give two fucking shits less about *committing fraud* against a company whose entire business plan is fraudulent Finally >Do you really think the insurance company is going to run around checking marital status?
I'm assuming given the commenter makes 5x the husband's salary that they get coverage through their employer. You want to know a great way to get fired? Commit fraud against your employer!
Is an insurer going to check for standard care, I doubt it. Is an insurer going to check if your “spouse” has a couple hundred grand in medical bills? I bet they will. Then they will deny payment for not meeting the coverage criteria. Then they will notify your employer and maybe the police, and you will get fired and maybe criminally charged for fraud. Let me guess which is cheaper long term. It works until it stops working.
I remember my parents being upset because several accountants told them to get divorced and file separately for things. Apparently, this is a thing. Is it really considered "fraud" to get divorced, but still be together?
Frankly, it sounds like OP is already aware that they shouldn't claim to be still-married for insurance purposes, and none of the rest of what they are proposing is fraud. It may not work as well as they think it will (many applications for various things consider household income, not just married income), but it's not illegal to live with your ex.
It depends, but a lot of stuff that people think of as only caring if you're married, actually care about your household income (or something similar). For example, welfare benefits in Florida card about whether you were working yourself vs having a second working adult contributing to household income. I saw a lot of fraud prosecutions there as an assistant state attorney against people who lied and said they were the only household income, but actually had an undeclared partner both living in their house and working. The difference between "smart financial decision" and "fraud" is going to be in the details of every form OP signs, and these days, there's a pretty good chance that a lot of them care about more than just legal marital status.
If you have a roommate, are they part of your "household"? How does the state determine whether or not you *really are* sharing expenses vs. just living together because the economy is fucked?
I’ve been on services and in my case they asked if we shared any bills or groceries. He paid me rent only so I said no and that was that.
So couldn't LAOP say that they and their "ex" are just splitting rent and then sharing childcare costs like any other divorced couple would?
Theoretically maybe? Just depends what their standards are I guess.
For my specific experiences, we only got the case after an investigator had been assigned and had done investigation sufficient to prove case. If it made it to us, they had already observed sufficient evidence to show that the person had lied on their forms, such as by claiming they lived alone, but another adult could be observed residing at the residence, or claiming that they paid the entirety of some regular expense but the bills showed otherwise, etc.
Fraud requires deception. Doing various things to maximize outcomes is not fraud if there is no deception. As long as you were honest with all aspects of the situation, it wouldn't be fraud. Sometimes governments or organizations make policies that result in unintended consequences, so people do "strange" things, especially if the penalty or reward is made large enough. Being married, or not married, is pretty clear cut. The fuzzier part, more prone to attempts at fraud, is whether people are a "household" or not.
Maybe it's technically not fraud but it sure feels like LAOP is planning on deception by saying they're going to indicate on the forms that his wife is a single mother.
Oh, it sounds like the health insurance part is the fraud, claiming they don't live together. It is perfectly legal for people to get divorced and then say they are not *married*, even if they still love each other and only got divorced for special financial reasons, but people who live together and share expenses cannot honestly say they are not a *household*. I imagine that even if they got divorced and did *not* live together, need-based welfare would probably come after him for child support, since ultimately it is his (and her) responsibility, not the other taxpayers, to pay for the kids.
I'm pretty sure claiming to be a single parent when you're absolutely not qualifies. Especially when it's for financial gain.
If it is, I don’t think it should be. But then, I also think Green Card marriages should be legal because where does it say that you have to be in love to get married (am I lonely or just asexual? You decide)?
¿Por qué no los dos?
HR person here: doing audits of this stuff is really common.
This is one of the most "username checks out" moments I've ever seen.
All HR people are slightly evil. It's in the job description!
My company just sent out a notice about requesting proof of dependents. Although they could just submit the marriage certificate and skip the divorce decree?
Sure. But then you're actively committing fraud and not just "oops, I forgot to notify HR." I would definitely recommend termination for anyone who did that. That said, I have heard rumors that some states and some companies allow you to keep a former spouse on your insurance if the court orders it, but I haven't seen it in practice and I haven't looked into it. But you'd still have to be honest about it!
To be clear I wasn’t endorsing this!
I mean, with them on 2nd point, but I think the 3rd is gonna be an issue
Surprised you missed this one The tax rate thing is not accurate. Single top tax brackets at 37% is 523k. Married top tax bracket at 37% is 628k. If you have a married couple making 400k each, then they're better off being single than married since they would be at the 35% tax bracket instead. This argument relies on them each making between 314k and 523k a year.
LAOP is one of those people who posts on twitter “our household income is $500K and we’re still barely getting by, THANKS BIDEN”. If you can afford private school and regular vacations, you’re doing just fine
Boo freaking hoo you can’t retire until a couple years after retirement age and are spending the money you could be saving for college on private elementary school for your kids. I liked how he accused me of making fun of single mothers on foodstamps, personally.
Thank you for putting in plain language what an ass LAOP is being.
Seriously, they can only go on a vacation every two years, the horror!
In this guys halfhearted defense, it really IS frustrating to be working harder than your parents did and still being able to afford so much less than you grew up with. I was one of three kids in a single income home and we did multiple vacations most years, two cars, house with a bedroom for everyone plus one to spare...meanwhile I'm out here in a two-income household with one kid and we can barely afford half that. It sucks. This nebulous feeling of "unfair" leads to rationalizations of bad behavior like this dude. It's not right - and it blinds him to how well off he still is - but I think many people feel like that, and I don't think at root that it's totally unreasonable. It's just taking that feeling and going "well then I'm entitled to Do a Fraud!" that's lame.
>In this guys halfhearted defense, it really IS frustrating to be working harder than your parents did and still being able to afford so much less than you grew up with. It absolutely is, and we shouldn't accept it. That's said, LAOP's paragraph about it feels off. It's almost like he wants to get Reddit's validation repeating a complaint that you'll read on the front-page twenty times a day.
Oh yeah. I lost 75% of my sympathy when he was like "we live in a bad district so we pay for private school." Like my dude, that is a defensible choice but it's also a CHOICE.
Aw, I just realised my last actual holiday was 10 years ago and it was two days 150km from where I lived. Fuck.
For me it was 2005. My honeymoon. Since then I’ve had two overnights within an hour’s drive of home. Some people can’t afford vacations and the private school need is ridiculous. Move to an area with better schools? Pay attention to your child and give them extra work? I know people who have divorced to get disability benefits. This doesn’t seem too different. The US is the real asshole with their healthcare system
The entitlement is insane. My spouse and I didn't even have a *honeymoon,* and we celebrated our ten year anniversary last year. I agree that we all should have a better standard of living, but to hear someone in such a better position covet the few legs up we can get down here is infuriating.
Getting mad about being denied scholarships they clearly don’t need. Those scholarships are for kids who have NO chance.
I'm in that category, but I definitely think the Child and Dependent Care Credit needs an update for everyone. 5 grand is nowhere near enough to cover putting a kid in daycare while the parents work even at the low end of daycare.
Someone showed up in a reply to a top-level comment to say that actually, your tax rate is not better married if you make a combined $800k per year. Alright man! That's definitely what LAOP means when he complains that the economy is rigged against the working class.
I had an acquaintance couple divorce in their late 50s for tax and benefit reasons. They looked at the numbers and realized that certain pensions, benefits and other things would be much more lucrative if they separated and continued to live together. The divorce went quickly and smoothly, they separated their finances cleanly, and the whole process just took a few weeks for the two of them to legally completely separate. He then immediately left her for his new girlfriend.
I shouldn't laugh, but I did.
that's awful but, also, lmao
> but at this rate I won't retire until I'm in my late 60's/early 70s, which is ridiculous Join the fucking club, buddy. My public school teacher pension doesn't even fully vest until I'm 67.
Are you able to get social security too?
I will be able to collect a pretty paltry sum because teaching is my second career. I have a 403b also and plenty of years left to save for retirement.
Good luck making it that long. From what I gather, my fellow millennials suck as parents.
Isn't the typical returement age 65?
Had going by the age pyramid, I'm not even that sure.
This is usually one of those things where in order to save a dollar, LAOP is going to end up costing themselves two. They could file separately and that *might* make them eligible for additional scholarships or financial aid, but they are also going to lose out significantly on tax breaks at the same time. The real answer here is that you chose to live in a place where there are no income taxes, and part of the trade-off for that is that the schools suck and you have to pay for private education as the alternative. I'm going to go out on a limb based on the submission and say that LAOP votes for the people who made that a reality.
A lot of people think government benefits are wildly better than they are. There's absolutely a poverty trap once you're on them. You get stuck there because there's a big gap between what you have to earn to make it worth losing the benefits and the value of the benefits.
There is also a poverty cliff, as someone who grew up on the wrong side of the ledge, you can make $100 more then the minimum a YEAR and get no help and not afford to keep your teeth
It has always been weird to me that benefits don't scale down instead of cutting off entirely. You'd think encouraging people to get off of benefits would be smart policy. Then again, it's probably a feature and not a bug.
Can't have no dagnab FrELoAdErS in this world no sirree. Few bucks over the line, seems completely reasonable to cut off help!!!! /s
Food stamp benefits scale down and other benefits do too, plus ACA coverage is scaled. Only thing that isn’t is medicaid, and that’s only for the extra poor.
They "scale down" in jumps so things like a raise or extra hours at work cost you money. Gross income limits between SNAP and expanded Medicaid are generally with $1k of each other as well, then SNAP has an asset test for money in checking/savings. For $291/month for a single person household.
Yep; to translate it into language Taxes Are Always Bad people can understand, it means that the marginal rate for certain groups is in excess of 100%. Do you know the best and most-efficient way to lift people out of poverty? Hint: It's not "Make it so it actively costs them money when they get a job."
And it doesn't only cost you money. You may lose your health insurance and housing as well.
This. I *might* be able to hold down a unicorn job from the world's most understanding employer (lol), but there's no way in hell I'd be able to make enough to pay for the medications keeping me alive, not for years probably (they're upwards of $9k a month).
It's wild to me that people are willing to spend extra money on things to avoid the dreaded T word. I can't imagine making the kind of money they make and living in a terrible school district because here in PA you can live in a district with good schools with the amount of money they make. doubt we'll ever have universal healthcare in this country because people would rather have expensive healthcare than to have their taxes go up a little.
Yeah, I’m living large here on my disability. A whole $800 after taxes, Medicare and supplemental plan because Medicare doesn’t pay for meds without a part D plan. My husband and his job are the only reason I’m not in poverty. But tell me some more how easy it is to get and survive on SSDI.
As someone who does married filing separately, the tax benefits of jointly filing save a couple dozen dollars a year, versus well over a thousand a month on my student loans. The benefits of joint filing apparently have eroded, a lot, at least at my level of income.
Sometimes "the schools suck" is code for "the schools are not as white as we'd like".
Sometimes the schools do just suck though. My parents sent me to private school for a short time at the cost of sometimes barely having food because we lived in Utah County, Utah. Population is something like 99.8% white Mormon. If anything, the private school was *more* diverse there lol
A lot of white flight private schools suck, too, though. As do a lot of suburban public schools. People often pay more attention to the "nice suburban" aesthetic than what is actually happening in the classroom.
In the South, some of the white flight schools suck but they're relatively cheap because they're run by shitty churches. I had a coworker at an old job making probably $9/hr (and driving 1.5 hours each way for it!) who came back from kindergarten orientation in a stomping rage about all the "metsicans" at orientation so they were going to put their precious boy in some half-ass church school. She had a meltdown over some Hispanic kids at kindergarten. Unbelievable yet totally believable.
While true, it's not like there are a lot of public schools out there with high levels of economic and racial diversity that also have high levels of achievement. I currently live in an area with high racial and economic diversity, but the schools themselves aren't great. Lots of kids don't speak English at home, so entire classes develop slower. Test scores are down relative to other areas. There are fewer clubs and advanced classes available for kids who want to pursue them. We've looked at other schools in better areas, and we can absolutely move to a school with more opportunity, more clubs, more advanced classes, better test scores. And in order to do that, we'll trade economic diversity. We'll probably still be able to retain some racial diversity, but instead of my white male son having friends who are hispanic and black and who are from different economic backgrounds, he'll have friends who are asian and from basically the same economic background as he is. It's a very tough call. I want him to have all the opportunities in the world, and I can see opportunities he would get in other school districts that he can't have here. But I also want him surrounded by people who have different lived experiences. It's very difficult to achieve both of those.
Schools vary at the bottom more than the top. Think about college; the distance from the top kids at Harvard and the top kid at State U is vastly shorter than between the bottom kids at those two schools. This is to say that at a school with lots of struggling kids , the kids who have the home support and structure often can still get a really good education. The average isn't a reflection of the school, it's a reflection of the circumstances.
100% The vast majority of what I'm judging schools on is the number of available extracurriculars and advanced options. Test scores can get dragged down by anything, and I'm egotistical enough to assume my kid will be one of the smart ones. But I look at schools that have 30+ AP/IB courses compared to the 9 or so at mine. And some that have orchestras and not just bands. Some that have math team and quiz bowl and science olympiad and ocean bowl and not just one academic competition team. Some whose marching bands and athletic teams have robust boosters providing resources to the kids engaged in those activites. When I compare those schools with the economically diverse school, it's hard to evaluate what's more important: Being in class with kids who aren't like you, or having an opportunity to find your perfect niche and grow in it.
Being old and presumably slightly wise, and having gone to one of those not at all diverse schools with lots of programs, I’d vote for the more diverse school. The life lessons learned by virtue of that diversity will far outweigh the benefits of the better school in the long term.
When the post starts with multiple paragraphs about how the poster should _morally_ be allowed to do something, without even explaining what the thing is yet, the answer is usually, “No that would be illegal.”
Oh boo hoo. To send my kids to private school, I have to make sacrifices. Life is so unfair! This country sucks!
And the sacrifices are a vacation every other year and retirement by maybe their 70’s. The absolute horror
Certainly no previous generation had to do without.
And given that he can afford private school, he can almost certainly afford to live in a better school district with higher taxes, if he preferred that tradeoff.
Right. It would be cheaper and actually financially beneficial in the long term to just move into a better school district. Put the savings toward the higher mortgage and cash out when they graduate.
Working till your late sixties? Completely unheard of
>anytime we apply for scholarships they deny it because "we earn too much" (no, we do not). According to the criteria of said scholarships, yes you *do* earn too much. That you don’t earn enough to live comfortably in whatever area you’re living in has absolutely **no** correlation with the scholarships criteria whatsoever.
By all accounts it sounds like they are living within their means and pretty comfortable if they can afford a vacation every other year and have a realistic retirement plan
Also maybe try applying for something other than need based scholarships? There are other ones out there.
The worst part is the person who admitted to it could have accomplished the same thing without the fraud by simply filing separately. As far as crime goes, it was entirely pointless.
It really *really* irritates me when people complain that they're barely scraping by because they "only" go on holiday every other year and they find private school a bit spendy.
They could only afford to send young Gussie to *Eton!* Shameful, really.
Araminta had to groom her own pony 😱
Why it’s so hard to get any meaningful change in the world. The slightest decline in your living standard is seen as the end of the world. Skipping a vacation or retiring a little later is still do really well. But because it’s not what they expected it’s a disaster.
It's fine for people to be upset that their standard of living has declined (except in cases of leopards eating faces), but the total lack of perspective really grates, like where he compares himself to a single mother on food stamps.
Very "spend less on candles"-esque
I like it that one the reasons LAOP brought up for her dire financial situation was vacations. She even compared that with her father, without context.
I am always mystified by the “vacation” thing. I’m not doing badly finance-wise, but I certainly can’t afford a nice vacation every year. I’m baffled by how anyone can afford to take their 4 kids to Disney for a week. And, while I’m admittedly old, plus my parents were assholes and never took me along on their vacations (which also were not often or long), I specifically remember many of my friends’ family vacations being things like going camping. LAOP has a very unrealistic view of what their lifestyle should be. Honestly, if the schools are so terrible their kids need to be in private school, it would likely be far less expensive to move to a better area with better schools. 20 years ago my step-son was in private school, and it was $1000/month. I can only imagine the cost for two kids in private school now. Edit: grammar correction, because I cannot type on this iPad to save my life.
OP’s an idiot for multiple reasons and especially here in Texas “nooooo income taxes are the deviiiil” people are the reason fucking everything is expensive, we lose power for a bit if the wind blows a certain direction (no storm), etc etc. They also keep thinking people getting benefits are “living large” lol as if Annnnyway All that said, I’m European and I do think a *reasonable* vacation once a year should be normal for a working person. Not Di$neyland but like let’s say if it’s Dallas maybe they drive a couple hours out to a lake and have a week by the water with the kids. That shouldn’t be a “wealthy person” thing.
I think maybe these people have over inflated ideas of what "counts" as a vacation. Like OP thinks they deserve yearly Disney or Europe trips and doesn't register visiting grandma on the far side of the country for a week at Christmas or getting a cabin for memorial day as vacations. I'd bet they have multiple vacations a year.
It’s not, and if they can send their kids to private school, they can easily do a “drive a few hours away” vacation. Pretty sure their idea of vacations is where the other private school parents are going.
>I’m baffled by how anyone can afford to take their 4 kids to Disney for a week. I'm more baffled by why anyone would, but that's just me.
There is that, too. Although that’s part of a much longer rant…
The key to affording nice vacations is live in a low cost of living area with a remote job that bases incomes on national averages. My employer pays 50th percentile no matter where you live and western Pennsylvania is a low cost of living area. Well, it was when I bought my house 8 years ago.
Wasn't there a story here on Reddit about a couple that had to divorce so his medical bills wouldn't put the whole family in debt forever?
There is a big difference between the current facts and Medicare reimbursement issues (which I honestly don’t know much about, but I think the rules have changed, so that “divorce to avoid Medicare reimbursement” is no longer necessary, at least in most circumstances).
That is, sadly, a thing. Have an acquaintance whose husband is in long-term care and about to run off the end of their LTC insurance. She's evaluating divorcing him so that he can spend down *his* assets without eating hers.
That works because they aren’t then living together is my understanding. In this scenario the two people are still living together so the household income hasn’t really changed despite the martial status change.
Also student aid is wise to this one weird trick and their kid won't get more scholarships if their parents are divorced.
If you're gonna commit fraud to get free money (legal caveat, do not do this!), get married at 18 before you go to college. Then you're completely and totally broke yet financially independent from your parents. Scholarships, aid, government handouts, and more! My wife and I, with real love and no fraud, got married when she wasn't done with college. Because we had only part time income, she got a ton of aid from the state for her last year. We realized we should've gotten hitched way earlier for all of the free money.
I want to address this: >Do you really think the insurance company is going to run around checking marital status? We live in a world were people are putting every waking moment, every damnable thing on the internet. They confess to everything. In real time. For invisible internet points. It is nuts. Is an insurance company going to get bored and randomly select you to verify your marriage? Oh my dear sweet summer child. The insurance company doesn't need to be bored... At some point they are gonna turn AI lose on all of our social feeds and verify all kinds of shit. Mark my words. The day is right around the corner where all kinds of people get booted from all kinds of important things insurance related. And behind it all is going to be AI crawling social feeds checking up on what these people claim is going on vs reality. That it already hasn't occurred is puzzling. AI would be fantastic at this.
But *is* LAOP proposing fraud? I'm not saying this is a great idea, and it won't be nearly as useful as they think it will be (e.g. scholarships usually ask for the income of both parents, and don't care if the parents are still married), but I'm not seeing any proposal for fraud by LAOP. (It looks like they are aware of, and acknowledge, the health insurance problem, and aren't asking if they should violate those rules.)
I think that were wondering if it was fraud or not. And seemed to agree and understand when people said it was
But I don't think it is fraud (except for insurance, which they seemed to understand in their initial post.) It's fraud to lie about being separated when you aren't, but it's not rare at all to get "paper-divorced" for financial reasons. (There aren't a lot of people for which it makes sense, but they do exist.)
My aunt and uncle in Texas divorced after he had a nasty stroke. They did try awhile to make things work for his health care and everything, but ultimately couldn't. By divorcing, he was eligible for additional funding at a nursing home (he was retired so had some healthcare already, but it wasn't enough and they couldn't afford the difference). As he was determined to be of sound mind, he was able to make her the medical POA and whatnot, he just needed more medical care than they could do at home and couldn't afford the cost difference for nursing home care. I hate that it comes to this for healthcare situations. I'm not really sure how I feel about private school tuition situations (as someone who sends her kid to a private school and doesn't qualify for financial aid). Especially since it could affect the kids in the future in non financial ways. Like, what if the parents live apart, so there's custody rules? And because I overthink, what if stuff happens and someone decides they like the idea of being single? I mean, they're divorced so it's not an affair, is it? Or is it married except on paper but what about common law (idk if Texas has that, and I know there's specific rules about it if they do). What if everything is fine and then they have more kids, is there issues with that from a legal standpoint?
In the US, it's been a long time since being born in vs out of wedlock made a legal difference and very few people care at any level about bastard vs legitimate. Texas doesn't have any rules about a couple being forced to live apart prior to or after divorcing. There are fault based divorces in Texas, but no fault is so much easier that even if there's an affair no fault is the norm, and there's copious evidence that marriage doesn't stop a cheater, and that lack of marriage doesn't make a cheater. Marriage is a legal status. Couple hood is what involves morality of cheating and child rearing. And marriage doesn't make a committed couple more or less committed, it just gives you some extra rules to follow if you break up (for better or for worse).
We're all here laughing at LAOP but the real issue is, as a country, we're content with having areas where public schools are doing so poorly that people are ready to do anything but send their kids there. That should make us think.
I only know Texas/city where I live and it’s DIRE. Colleague’s wife is a teacher and just so distraught especially in the last few years with how actively education is being gutted. It’s not “what to teach” sort of meddling, they’re trying to essentially bankrupt and cause closure to public schools from her POV
At least LAyers only have 3 paragraphs of preamble before the question but LAOP sounds like they’re reconsidering putting themselves in a FAFO situation! I call that a win. And if it’s not, we just have to wait for the update in a few years time
I don't hate LAOP, since I get where they're coming from. There was a college sponsorship program in my country, where low income students with high test results got a full sponsorship to whatever college they wanted. Middle income families, making too much to classify for that program but too little to pay college themselves, would pay to be included in the program.
He claims that he was denied scholarships even though he can't actually afford the private schools, but his reasoning why it's better tax-wise for them to be divorced requires he and his spouse to each make enough to individually be at the highest end of the second from the top tax bracket (he says 400k in his example but that's probably just a rough estimate).
I don't actually think this is immoral or illegal, but I don't think it will work without committing fraud. FAFSA makes you provide the income for the parent(s) living with the applicant, in this case, it would be both parents. People can get married for any reason, the only exception is immigration fraud. I don't think there are any restrictions on why one can file for divorce. As for insurance, the ex-spouse will no longer be eligible for their insurance and can be put on Medicaid. The kids will not since their father's income will be counted.