When it comes to alimony payments and rather or not they are taxable, is it an all or nothing proposition or can they be split 1/2 taxable and 1/2 not? I ask because my wife’s lawyer is adamant about my alimony payments to her being tax free and I’m wondering if there might be room for compromise with this type of arrangement.
Thank You!
Does anyone know the answer to this?
Thank You
IRS states that alimony received is included as income to the recipient and is deductible to the payor unless the parties agree to opt out of this. You could agree that 50% be taxed/deductible, but you will want to consider the tax implications this may cause for you.
Check out our article on this issue: Divorce, Alimony, & Taxes.
Anna Ayscue
Attorney with Rosen Law Firm Cary • Chapel Hill • Durham • Raleigh • Wake Forest
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