TAX NEWS - 2010

Home > Tax News > June 2010

Go to Tax Rates Home Page

Alimony: Taxes, Medical Insurance, and Stock Options

Alimony Taxes

Payment of alimony tax implications for both spouses in parting.

Spouse to make alimony payments to support the family, and a separate maintenance payments, and spousal support, you may deduct these amounts in determining taxable income the total. For a husband to pay amounts due, payments and taxable income in the year received. It is clear that this is not the case in countries which do not impose a tax on income. In those States, and the payment of subsidies can not be tax-deductible expenses and support payments received are likely to be possible only subject to federal income tax. (It should be noted: This is not the case with child support!) To qualify for the deduction, taxpayers support must be in line with the requirements of the IRS the following:

- And payment must be made in cash, check, or money order payable on demand.
- And payment must be made under a divorce or separation instrument.
- This would be either a court order, a divorce or separation decree, a written instrument incident to such a decision, or decree, which requires the spouse to make payments for the support of the other spouse or maintenance. Or
- This will be a separate written agreement between husband and wife who live far away. Required periodic payments because of the marital relationship or family (whether or not an agreement can be legally enforceable).
- And the couple can not file a joint income tax returns.
- A written instrument or agreement must not provide for tax treatment of the other.
- Motive does not bear any responsibility to continue to pay after the death of the other spouse.

Unlike most of their salaries, maintenance checks do not have withheld taxes. As a result, it is up to the recipient to plan for the future: either to increase withholdings taken from another source (the recipient's salary support) or pay estimated tax authority. If not, it will be the receiver in for an unpleasant surprise when tax time rolls around.

Finally, the recipient can not spend a short form of federal or 1040EZ 1040A, because the maintenance is not on any of these returns. Must file the form of more detailed income tax for 1040 show that income.

By any person agrees to the former spouse on the type and amount of alimony, it is necessary to speak with the Comprehensive Peace Agreement on the implications of the tax. As with most legal issues, and spending a few dollars on professional advice can save a lot of dollars down the road a lot.

Medical insurance

Husband supported may depend upon the other party for health insurance during the marriage. If so, and if the husband does not have supported adequate means to obtain this insurance, the court may ask the husband to pay to continue to provide medical insurance. Can be increased or? The amount of alimony or property settlement to give the husband to support the ability to buy insurance on his or her own.

It should be noted that may be required for the validity of employer-sponsored group insurance plan in accordance with federal law (COBRA) to provide continuing benefits in the insurance rates on a pair of credit for up to three years after the marriage has ended.

Stock options

In some countries, are stock options and income eligible for the award of alimony. Difficult to value and a fertile ground for headache taxes, stock options complicate things too much. This is the scenario that calls another to get professional advice. Expert on the problems of divorce, and the CPA, or tax lawyer for all professionals who can shed light on the complexities of stock options in case of divorce, and well worth the expense.

© 2009-2012
2011 - 2012 Tax Rate Guide and Tax Help Website

Tax Rates
Tax Rates
Global Average Tax Rates
Historical Tax Rates
Tax News
Tax Videos
Tax Articles
IRS Tax Forms