When couples in New York decide to get divorced, one of the factors that they may have to address is whether one spouse will have an obligation to pay the other spouse alimony. Alimony, also known as spousal support, is when one former spouse provides the other with monetary support in an effort to help them become financially stable after a divorce or reimburse them for money spent during the marriage, in some cases.
The United States government just signed a new tax bill into law, called the Tax Cuts and Jobs Act, which has an impact on a wide variety of tax-related subjects. One such change is to the tax implications of alimony payments in divorce. Prior to 2018, the tax law stated that individuals who receive alimony can include the payments in his or her income and that the individual who made alimony payments would be able to consider alimony a tax deduction. This is still applicable to divorce decrees signed before 2018. Any divorces finalized on or after January 1, 2018, will be subject to the new law which eliminates the tax deduction for people who make payments and would make the alimony tax-free to the individual who receives it.
It is important to discuss alimony and the new tax implications with your attorney if you are considering a divorce. Contact our firm today to schedule a consultation.
If you need strong legal representation regarding matters of divorce, family law, and estate law, contact the Law Offices of Susan A. Kassel, P.C. to schedule a consultation today. b