Alimony Deduction Denied

Alimony Deduction Denied

Posted By: Jennifer O'Neill // Dec 7, 2015

In order to determine whether payments may be claimed as alimony under section 215. all four requirements must be meet.  IRC 71 (b)(12) specifies that any payment in cash will be considered alimony only if

  1. The payment is received by (or on behalf of) a spouse under a divorce or separation agreement
  2. The agreement does not designate the payment as a payment which is not includible in gross income or allowable as a deduction under 215
  3. The payor and the payee are not members of the same household at the time the payment is made
  4. The liability to make the payment ends for any period after the death of the payee

In certain cases state law can determine deductibility.  For example in Florida the death of the recipient of the alimony does not terminate with death.  Therefore when the liability survives the death of the recipient the payments would not be deductible.

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