If you have been ordered to pay alimony or the courts have decided that you will receive alimony, you might be wondering how it will affect your taxes. One of the things that separate alimony from child support is that the spouse receiving it will have to pay taxes on it. So, it follows that if one spouse is paying taxes on it, the spouse paying it can use it as a deduction.
You can deduct alimony payments if you meet the following requirements:
- Your alimony payments are paid in cash. This includes money orders and checks.
- You do not file a joint return with your former spouse.
- You are not required to make alimony payments after your ex-spouse’s death.
- The payment you make is not considered child support.
- You aren’t living on the same property as your spouse or ex-spouse. This applies if you are legally separated.
If you receive alimony payments, you’ll need to include them on line 11 of your 1040. If you pay alimony, you’ll want to make sure you keep meticulous records. If it’s a check, always make a copy and if it’s cash, always have your ex-spouse sign something saying they received it. Both returns should say the same thing; Uncle Sam doesn’t want one spouse taking deductions for payments that were never made.
If you have any questions about how alimony will affect your taxes or you need help with anything else related to your divorce, a family law attorney may be able to help.