Do I Have to Pay Taxes on Alimony?

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  • Written By: Lainie Petersen
  • Edited By: Melissa Wiley
  • Last Modified Date: 22 May 2020
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Depending on the tax laws in the place where you live, you may have to pay taxes on alimony you receive. In the United States, alimony is taxable for the recipient, though the spouse who pays alimony can under most circumstances deduct alimony payments from his taxable income. While the United States does levy taxes on alimony, there are no taxes on child support received from a former spouse or partner. Divorce law in other countries may treat taxes on alimony differently, so it's a good idea to speak to a tax attorney about your obligations in this area.

Alimony, also known as spousal support, is financial support paid by the party to another following a divorce or legal separation. Unlike child support, which is treated very differently in United States family law, alimony is regarded as a form of income for the spouse who receives it. Thus the spouse must pay income taxes on the money she receives. The individual who pays the alimony is not responsible for deducting or paying these taxes, so it is the responsibility of the recipient to pay taxes on alimony received. To avoid having to pay one large tax bill at the end of the year, many people in the United States who receive alimony choose to pay estimated taxes on a quarterly basis to the Internal Revenue Service (IRS).

United States tax law does not require custodial parents who receive child support to report the child support as income. A parent who pays child support to another parent is not permitted to deduct child support from his taxable income. As such, it is crucial that alimony and child support payments be kept distinct in the accounting of both parents to avoid tax problems.

The individual who pays the alimony may be able to deduct his alimony payments from his own income for tax purposes. As of 2011, the IRS requirements for deducting alimony payments from your taxable income include the requirement that you and your former spouse do not file a joint tax return and must be living in separate households. The alimony payments must be in the form of cash, check, or money order, so you can't deduct the value an investment or other asset paid in lieu of the spousal maintenance. In addition, the alimony must be identified in your divorce decree or legal separation agreement as alimony or spousal maintenance. If the payment of money is identified as a financial settlement, you will not be able to deduct your alimony payments from your taxes.

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