Can I deduct alimony payments from my taxes?
On behalf of Barli & Associates LLC posted in alimony on Friday, July 7, 2017.
New Jersey residents do not tend to enjoy paying alimony to their ex-spouses each month. Fortunately, in many cases, the alimony payments you may be forced to pay will be temporary. Also, the money you give to your ex-spouse will be tax deductible. Your ex, who receives the money, will be the one required to pay taxes on it.
If you want to deduct your alimony payments from your taxes, you’ll need to meet the following requirements:
— You don’t file a joint tax return with your ex-spouse;
— You make your alimony payments by way of cash, check or money order;
— Your divorce decree or agreement does not indicate that the payments you’re making are not alimony;
— You are not living with your ex-spouse in the same household while you’re paying alimony;
— You will not need to continue making payments following the death of your spouse; and
— Your payments are not child support.
If you satisfy all of the above requirements — and most New Jersey residents paying alimony will — then you can deduct your alimony payments from your total income each year when filing your taxes. To ensure that you make your deductions lawfully and appropriately, it’s important that you keep exacting records of your payments, amounts of payments, dates of payments and other information — including a copy of any check and a copy of the bank receipt showing that the check was cashed.
New Jersey residents with questions about the tax implications of alimony payments may want to talk with both a Certified Public Accountant and a lawyer. These professionals can offer guidance to ensure that you are treating your alimony payments appropriately on your tax returns.
Source: FindLaw, “Alimony and Taxes,” accessed July 07, 2017