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Deducting alimony

People in Pennsylvania who get a divorce may be required to pay alimony to an ex-spouse. The person who receives the alimony is required to include the payments as part of his or her taxable income. The payers, or the spouses who have to pay the alimony, can usually deduct the alimony from his or her taxable income. However, it is important for the paying spouses to know that the payments may not always be deductible.

The payments made to a spouse or ex-spouse as dictated by a separate maintenance decree, written separation agreement or divorce decree can be considered alimony and deducted from taxable income on a federal return. Other conditions have to be met as well, such as the parties must not file joint tax returns with one another or reside in the same home when the payments are made. The payments also have to be made in cash or some comparable form, like money orders or checks. The separation or divorce instrument cannot explicitly state that the payments are not alimony, and there cannot be a responsibility to make the payments when the receiving spouse dies.

Payments made to spouses for other purposes, such as for a property settlement or child support, are not considered to be alimony. As a result, these payments cannot be deducted from taxable income.

The United States Congress is considering tax reform laws that may cancel the alimony deduction. If the legislation is approved, taxpayers would still be able to deduct the alimony they have paid on their 2017 tax returns.

Individuals who are getting a divorce may require the counsel of a divorce attorney to ensure that their interests and rights are being protected regarding alimony terms. Lawyers may turn to litigation or negotiation to ensure that their clients receive or pay the right amount of alimony.

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Law Office of
Katrina Luedtke LLC

Law Office of Katrina Luedtke LLC
43 West Middle Street
Gettysburg, PA 17325

Phone: 717-253-9951
Fax: 717-420-2151
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