Support

Legal Review: Changes in Tax Law Impact Alimony Payments

By New York family and matrimonial attorney Mario D. Cometti, a partner with Tully Rinckey PLLC.

The Tax Cuts and Jobs Act (TCJA), which was passed at the end of 2017 and went into effect for the 2018 tax year, has a multitude of new provisions that will have both positive and negative impacts on millions of individuals, including those paying and receiving alimony.

Under previous tax laws, alimony payments under a divorce settlement or decree were deductible for the party making the payments and taxable income for the receiving party. This effectually shifted the tax burden to the lower-earning individual and reduced the taxes owed on that alimony payment, thereby opening a bigger pool of money to pay alimony from.

“Under the TCJA, alimony payments are no longer deductible for the paying party, nor or they considered taxable income for the recipient party in any divorce entered after December 31, 2018,” said Albany matrimonial attorney Mario D. Cometti with the law firm Tully Rinckey, PLLC.

Although this may seem like a win for the recipient and an increase in tax receipts for the government, the actual effect may be less positive.

Alimony payments were an “above the line” deduction, meaning they reduced the taxable income of the individual making the payment. This could provide recipients with leverage in negotiating amounts by showing the tax savings associated with the payments. The result was that an individual could make alimony payments without feeling the full impact of those payments on their net income.

With the new law, the recipient no longer must show alimony as taxable income, but the actual result puts the leverage into the hands of the paying party. The paying party will now be able to argue there is a smaller pool to make payments from because of the lost deduction, while also being able to argue the recipient should be able to do more with a smaller amount because it is tax-free.

If you have questions about this shift in tax law, or alimony and divorce in New York, contact a knowledgeable attorney with Tully Rinckey, PLLC today to schedule your initial consultation.

Recent Stories

Daily Debrief for Nov 29, 2022

Good Tuesday evening, Arlington. Today we published 7 articles that were read a total of 7888 times… so far. 📈 Top stories The following are the most-read articles for today…

Two dogs with the ruff job of sniffing out danger at Reagan National Airport are in the limelight. Ava and Messi — the pair of pooches prowling DCA for smelly…

Join the Alexandria Symphony for their Home for the Holidays concert on December 17-18.

Update at 2:55 p.m. — Metro is single-tracking past the station and expected to resume normal service soon, with fire department units clearing from the scene. Blue Line service has…

Grab some friends and sign up for Parks & Rec’s Eugene J. Green Memorial Winter Basketball League! Adults 18+ can register teams of up to 12 people for the ten-game season. Cost is $765 per team. Games are Mondays and/or Wednesdays at Arlington Mill Community Center starting the week of Jan. 4. Sign up here by Dec. 11.

Submit your own Announcement here.

Join us at Art House 7 this Saturday 4-7pm for our Annual Open House – Teacher and Student art show!

  • Meet our teachers
  • See student and teacher artwork
  • Teacher’s paintings, ceramics, notecards will be for sale
  • Enjoy beverages and light refreshments
  • All attendees get a $20 gift certificate off a class
  • 30% off everything in our Supply Store for holiday gifts

Sat. Dec. 3, 4-7pm

Art House 7
5537 Langston Blvd.
Arlington VA 22207
arthouseseven.com
703-269-0946

Submit your own Announcement here.

National Chamber Ensemble – Holiday Cheer!

NCE’s Holiday Concert will bring the finest classical masterpieces and holiday favorites together for the whole family. The festivities begin with Leroy Anderson’s classic “Sleigh Ride” and “Chanukkah Festival”, music from the Nutcracker and by J.S. Bach.

Outstanding Young Artist

Washington-Liberty Annual Holiday Bazaar

Join us Saturday December 3 from 10 to 4 p.m. at W-L High School, for this much anticipated Arlington holiday tradition! We will be featuring over 65 vendors for gift shopping, our student clubs and activities fundraising booths, and food

×

Subscribe to our mailing list