"Distributional award"


#1

My property settlement (and finalization of my divorce) has me awarded a “distributional award” payable in monthly payments (which INCLUDES some back alimony but no wording on statement to reflect this)that he owed. Since this is labeled “distributional award” and not “alimony” specifically I consider it just part of the division of property and not taxable by me. He says it is still Alimony and taxable! Is this something that you can advise me on? Thanks so much.


#2

Since the agreement does not call the payments alimony, it should not be considered taxable. For alimony to be taxable it has to be labeled as alimony and not be for payment of child support or a property distribution. The IRS has publications available which detail whether payments are considered alimony for tax purposes.