Effectively Navigating The Tax Consequences Of Spousal Support
A divorce can have a significant impact on the financial situation of both spouses. Spousal support is meant to help maintain the standard of living for both spouses as they adjust to life after marriage. However, the new federal tax law established on January 1, 2019, means significant changes for both the payor and recipient of spousal support.
An experienced lawyer can help guide you. With Patrick M. Noe, Jr., Attorney at Law, you will find thorough and sympathetic counsel that meets your individual needs during and after your divorce. Contact our Williamsville office at 716-803-8741 for a free consultation today.
How Does The New Law Affect Spousal Support?
Spousal support, or spousal maintenance, can be a considerable amount of money. For that reason alone, it was common for:
- Those paying support to take tax deductions
- Recipients of support to record it as taxable income
The new Tax Cuts and Jobs Act (TCJA) changes that. If your divorce was finalized after 2018, payors can no longer take tax deductions for their support payments. Recipients do not have to include these payments as taxable income.
For payors who can no longer make tax deductions, spousal support could possibly become a lot more expensive. The payors generally bring in more income than the recipients, but that also means they might have a higher tax rate as well. Not being able to deduct spousal support payments could have significant financial consequences.
Reducing Tax Consequences
At our firm, we can help minimize the effects of this new tax law on your finances. It is our goal to protect your best interests and help meet your needs in the most economical fashion.
Patrick M. Noe, Jr., Attorney at Law, works directly with each client. He will thoroughly analyze your alimony situation and give you personalized advice on how to navigate the tax changes. Facing these changes might be stressful, but we provide you with the responsive support you need.
Get Experience On Your Side
You do not have to face these serious changes on your own. We will be by your side from start to finish. Call 716-803-8741 for a free phone consultation or contact us online. From our Williamsville office, we serve the greater Buffalo and western New York areas.