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Does the IRS consider alimony to be taxable income?

A recent post noted that alimony payments can be critically important for a former spouse who lacks sufficient property or assets to provide for themselves after a divorce, or who stayed at home during the marriage and now needs to get back into the workforce. Minnesota courts will often award alimony, also known as spousal support, under these circumstances. But, is alimony taxable income for the ex-spouse who receives it? And is it deductible by the ex-spouse who is obligated to pay?

The short answer is yes on both counts. Alimony payments are considered taxable income to the recipient, and are deductible by the payor.

An ex-spouse who is obligated to report alimony as income should do so on the line provided on the tax return. Recipients are required to provide their Social Security number to the payor, and the payor must include that number on their return in order to claim the deduction.

An ex-spouse who wants to deduct alimony payments on a tax return should make sure the payments in question are in fact alimony. A payment to an ex-spouse in connection with the property division aspect of a divorce is not deductible, nor is child support. Other requirements must be met for the payments to be deductible, including that the two former spouses are no longer living in the same household and are no longer filing joint returns, and that the divorce decree does not say the payments are in fact not alimony. Payors can deduct alimony even if they do not itemize their deductions.

Source: Findlaw, "Alimony and Taxes," accessed Oct. 3, 2015

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