Tax Implications in Divorce/Separation
Attorney Susan
Rizos can advise you generally about the tax consequences of the financial terms of your divorce or separation. For
example, as a general rule, alimony (maintenance) payments are tax deductible for the payor spouse and must be claimed as
income for the payee spouse. On the other hand, a lump sum payment would not be tax deductible. In addition,
child support is not tax deductible and does not have to be claimed as income.
A settlement must take tax implications into account so that both parties are treated fairly in terms of economics.
Certain language must be included in a settlement agreement or separation agreement to ensure that the anticipated tax consequences
are in fact achieved.
For
more detailed assistance with tax related issues in divorce, the attorney refers clients to a certified public accountant.