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Get the notepad out when alimony is involved

| Dec 29, 2017 | Child Support And Spousal Maintenance |

There are many issues involved in any divorce, and each individual issue will have numerous aspects to it that you have to consider. The further you drill down, the more complicated the divorce becomes. Every divorcee learns this at some point.

But instead of talking about that, we want to focus on a single issue today, and that is spousal maintenance — which is also called alimony. This form of financial compensation in the wake of a divorce isn’t always awarded. But when it is, it holds an important purpose for the receiving spouse. That financial compensation is meant to ease the financial burden of the divorce, which can take a heavy fiscal toll on anyone.

When alimony is awarded, both spouse need to understand the tax implications of the compensation. The paying spouse is allowed to deduct his or her payments from their taxes, while the receiving spouse must include those alimony checks as part of his or her taxable income.

There is also a “recordkeeping” aspect to alimony of which some people are not aware. Both spouse should keep extensive records of their payments (whether they pay or receive alimony).  Include as much information as possible, including the date of the payment, the addresses used for the payment, the check number and bank used for the payment, and the amount of the payment. If the paying spouse uses a cash, the two of you will need to create a receipt that you both sign.

Source: FindLaw, “Alimony Guidelines: What Records to Keep Regarding Your Alimony,” Accessed Dec. 29, 2017