With the onset of the new tax law regarding alimony, couples are expected to go through more rigorous processes while seeking a divorce. This practice renders spouses paying for support eligible for a tax deduction, while the one receiving support pays taxes according to their personal income bracket. Law professionals ensure the public that the new law is designed to help couples save more money during the divorce process, thereby allowing the transitions to come easier.
Unfortunately, experts argue that this new federal tax law on alimony will also widen the problem—the spouse with the higher income will be at a disadvantage, making the process of divorce even more difficult.
Understanding the Implications
1 – Ineligibility for tax deductions
2 – Lack of contributions towards the IRA
3 – Changes in the number of divorce cases going to court
How much will you be paying for alimony under the new federal tax law?
- Whether parties are able to pay
- How long the couple was married
- Where each party stands in terms of age, physical and emotional health
- How the couple lived while they were married and how likely they are to continue living at a comparable standard of living post-separation
- Where each party stands in terms of earning capacities, educational levels, vocational skills and employability
- Whether a party was absent from the job market for a time
- Who is responsible for any dependents
- Whether one or both parties hold other assets or receive passive income
- How any alimony awards may affect either party’s tax situation
Enlist the Help of A Divorce Attorney
The law itself is complicated enough. Throw in a few major changes, and the effects of misinterpretation can be detrimental. Divorce can already be a tumultuous process. As an emotionally draining period, financial pressures can make settlements almost impossible to accomplish. If you’re going through a divorce and wish to navigate the waters with help, seek the help of an attorney.
If you’re on the hunt for a divorce attorney in Hackensack, Tomasella and Vacca, L.L.C are ready to help. As a team dedicated to family law, we ensure that our services cater to the needs of each client. Every case is different, so we approach each issue with solutions that are both practical and realistic. With that, we come up with strong cases that fight for your needs. For more information, don’t hesitate to reach out to our team.