Changes to Spousal Maintenance

If the thought of having to pay your spouse maintenance, formerly known as alimony, was not bothersome enough, the new proposal tax bill may have just made the knots in your stomach even tighter. Maintenance is currently tax-deductible for the payer and taxable for the recipient/ With the new proposed tax bill in motion, this is all subject to transformation. The new bill would change the tax treatment of maintenance if your divorce judgement is entered after December 31st, 2017. For example, a divorce judgement entered prior to 12/31/17 ordering the husband to pay to the wife the sum of $5,000 per month as and for maintenance would be deductible from the husband’s income and would be includable in the wife’s income. However, a divorce judgement entered after 12/31/17 would not be treated this way.

Divorce is difficult enough, does this tax bill make it any easier?