Payments made to a divorced or separated spouse are called alimony. Most often the amount paid in alimony is decided upon in court and will be written in the divorce or separation decree. In these cases, the alimony is considered deductible by the person paying it and taxable income for the person receiving it.
Only if the alimony payments have specifically been deemed "nontaxable" or "nondeductible" can any alimony decreed by law be considered as such.
Payments agreed upon by the divorced or separated individuals without a legal decree are not considered taxable income or tax deductible.
Reporting alimony as taxable income to the IRS
Alimony is reported as taxable income by the individual who receives it. There is a separate entry for alimony on your tax return so it should not be included with any other taxable income.
If you paid alimony, you can deduct the total amount you paid during the year. In order to do so you will need to enter your spouse's social security number. If you fail to include the SSN, the tax deduction may not be honored and you may be required to pay a penalty.
Sidebar When you fill out your online questionnaire, H&R Block will include space to add information about alimony payments, so just as you would with a paper return, you don't need to include it in your regular income. If you paid alimony, you will be prompted to enter this information also, so that you may receive the proper deductions. Try H&R Block Now.
Child support and taxes
A common question from taxpayers is "Can I deduct child support from my taxes?".
The simple answer is: there is no child support deduction.
Child support payments are strictly designated for the benefit of minor children. These payments may be paid in conjunction with alimony payments, but they are treated differently. Unlike alimony, they are nontaxable and nondeductible.
To determine the amount considered to be alimony and the amount to be considered child support you should consult the divorce decree. If there is no indication at all, the total amount is regarded as alimony.
If the divorce or separation decree stipulates that both child support and alimony be paid, the child support is always paid first. This means that unpaid or late child support is supplemented by previous alimony payments.
As a payer, you are allowed to deduct alimony payments only after you have satisfied your total annual child support payments. If you have not met these payments but have made previous alimony payments, portions of those payments are reallocated as child support payments up to the legally decreed annual amount.
As a recipient, you should only claim the payments you have received that exceed the required child support payments as taxable income.
Related IRS publications
You can get more information about alimony payments made or received, and tax issues related to child support, directly from the IRS, in the form of Publication 504
Note: you will need an Adobe Acrobat Reader to view these publications, which you can get here. (But you probably already have it.)
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