My ex-husband wants to increase the amount of alimony and decrease the amount of child support (but still pay the same amount of money each month) for tax reasons. How would this affect my taxes?
For federal income tax purposes, child support is tax-free to the recipient but not tax-deductible by the payor. In contrast, alimony payments are taxable to the recipient and tax-deductible by the payor. That means it’s often to the payor’s advantage to pay more alimony and less child support, even if the total monthly payment is the same. However, for you, it will not be more beneficial — you’ll have to pay taxes on the “extra” alimony, while you wouldn’t have had to pay taxes on that money if it qualified as child support. Think of it this way: decreasing your ex-husband’s tax burden might actually increase yours, so run some numbers with an experienced divorce attorney or accountant before you agree to this. (Note: If you receive any partial payments that constitute both child support and alimony, the IRS rules allocate the money first to child support and then to alimony.) Additionally, even if you and your ex agree to structure his payments to minimize his tax burden, child supp
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