On behalf of Stange Law Firm, PC posted in divorce on Sunday, January 14, 2018.
If you are one of the many people in Missouri who is considering getting a divorce in this calendar year or perhaps after that, you will want to educate yourself about how the recently passed tax bill may impact the decisions you make along the way. When working through the details of a divorce settlement in which assets and debts must be assigned to each spouse, the assignment of child support or spousal support may well come into play.
For some time now, people who have made child support payments have been responsible for taxes on that money. In contrast, the people who have made spousal support payments have been able to deduce this amount from their income tax returns. It has been the responsibility of the spouse who receives alimony payments to pay income tax on these funds. While this has not necessarily made making spousal support payments something people want to do, it can ease the financial burden to some degree.
As explained by CNN Money, this is going to change for any divorce completed on or after January 1, 2019. Effective next year, the person who must make spousal support payments will also be responsible for making tax payments on the same funds. Because the identification of alimony may well be tied to other aspects of a divorce settlement, this change may have consequences for other elements of a couple’s divorce.
If you would like to learn more about the calculation of spousal support and the implications thereof, please feel free to visit the property division settlement page of our Missouri divorce and alimony website.