Who Pays Taxes on Alimony After a Divorce?

In a divorce in the Tampa area in which one of the spouses seeks alimony, the court will first determine whether any type of alimony award is appropriate. If the court determines that alimony is appropriate under the parties’ circumstances, then it will look at a wide range of factors to decide the type and amount of alimony to award, as well as the duration of the alimony award. The duration of the alimony award can range widely depending on the type of alimony and the length of the marriage. Whether alimony lasts for less than one year or for many years, it will be important for the parties to understand who is responsible for paying taxes on the alimony payments. Our divorce lawyer in Tampa can explain in more detail.

How Taxation on Alimony Works 

For any divorces finalized after December 31, 2018, the payer spouse — the spouse paying the alimony payments — is responsible for taxes on the alimony payments. This shift in the law changed taxation on alimony. For divorces prior to this date, the recipient spouse — the spouse receiving the alimony payments — was responsible for including alimony payments in their gross income and paying taxes on the amount received as income. Under that scheme, the alimony amounts paid were deductible for the payer spouse.

As such, if you get divorced now and an alimony award is ordered by the court, the payer spouse will be responsible for taxes on the amount. It is also important to know, as the IRS points out, that for any alimony awards “executed before 2019 but later modified if the modification expressly states the repeal of the deduction for alimony payments applies to the modification,” then it is possible that the payer spouse could become responsible for taxes on the alimony award after the modification.

Planning Ahead for Taxes on Alimony 

For the payer spouse, it will be important to plan to pay taxes on the alimony award paid. Since relatively recent changes to Florida law eradicated permanent alimony, you should expect for a bridge-the-gap alimony award to last up to 2 years, a rehabilitative alimony award to last up to 5 years, and a durational alimony award to last for up to either 50 percent or 60 percent or 75 percent of the length of your marriage (depending on whether you had a short-term marriage, a moderate-term marriage, or a long-term marriage).

A divorce attorney in Tampa can explain these alimony awards in more detail and can help you to understand what you might be able to expect in your divorce case.

Contact a Tampa Divorce Attorney Today 

If you have any questions about how alimony is awarded in a divorce or how to plan for taxes on alimony, an attorney can help you. Likewise, if you recently went through a divorce and a change in circumstances has arisen such that you need to seek a modification of an alimony award, you may be able to do so with legal help. An experienced Tampa divorce lawyer at The Law Office of Laura A. Olson, P.A. can speak with you today to learn more about your situation and to provide you with more information about your legal options. Contact us to learn more about how our firm can assist you.

Sources: 

irs.gov/taxtopics/tc452

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0000-0099/0061/Sections/0061.08.html