The Headline The Republican Tax Plan Imposes a New Divorce Penalty
As I understand it, a new tax law is about to be introduced. As it stands now, and in my case, my Ex gets to claim his alimony as a tax deduction. That never seemed fair to me. I have to pay taxes on the alimony I receive, and he gets a benefit for paying alimony. Wait a minute there is something wrong here! My husband leaves me thus taking away my security, breaking a multitude of promises to God and me, damaging my family, and then he is rewarded for this breach of contract with a very nice tax break. This is a miscarriage of justice in my opinion. If this proposed law goes through it will go into effect at the end of this year and will include future alimony rulings. The past judgments for alimony payments will not be included, and the slackers of the past can skip away with their high tax deductions. Whoever said life was fair?
There is concern that this could affect the alimony payout amounts. The worry is that the courts would consider the amount to be paid out along with the taxes that are no longer deductible thus decreasing the payout amount to protect the payor. Well, that is not fair either. The one who created the problem needs to pay out what he owes the one he or she has harmed. I don’t think anyone worried that I would be paying taxes on the monies I would receive. I don’t remember taxes on alimony ever mentioned in any of our legal proceedings.
So what is my hope with this new law, if it passes? I hope the ones who cause damage to others do not continue to be rewarded for their behavior with huge tax breaks. I hope the ones that have been lied to and harmed through the breach of marital contract get the money they deserve. I wish that the government would not grandfather anyone in, but as my mom used to say “if wishes were horses beggars would ride.”
I would love to know your thoughts on this.
Seems very unfair but made me wonder about how social security is impacted by divorce?🤔
“I would love to know your thoughts on this.” From the standpoint of the alimony payer, effectively the alimony payment has just increased by the marginal tax rate. Your assumption that the recipient of alimony was somehow wronged, which is what caused the divorce, may be true in some cases, may not be true in others, but is irrelevant to tax policy and is contrary to the intent of alimony: to keep ex-spouses with no income off welfare. “No-fault” is the key phrase; the courts don’t consider who’s the good guy and who’s the bad guy, they strictly look at who earns money and who doesn’t.