Tax problems during and following a divorce are common, but you can minimize them with a little planning and knowledge about tax law. Few tax issues are as complicated and intricate as alimony payments paid from one spouse to the other, especially since federal legislation is continually rewriting tax law. Before you make an assumption about reporting your alimony payments on your taxes in New Jersey, please read on, then contact an experienced Bergen County, New Jersey alimony lawyer today.
Do you have to count alimony as income on your taxes in New Jersey?
The Tax Cuts and Jobs Act changed how the federal government treated alimony. Previously, the federal government viewed alimony as income, requiring you to pay federal taxes on any payments you received. Since the enactment of the act, the person receiving the alimony has a tax advantage instead of the payer. The federal government no longer requires you to report spousal support you receive on your taxes because it does not count as income that you have to pay taxes for. Instead, you will receive the full sum of your alimony as non-taxable money.
Are there any exceptions to the Tax Cuts and Jobs Act of 2017?
There are, because alimony rules only changed for those who finalized their divorce agreement on or after 1/1/19. Therefore, if you were divorced before then, you won’t qualify.
If you have any further questions, please do not hesitate to reach out to our highly qualified family law firm as soon as possible.
Contact Our Experienced Bergen County Firm
If you are facing any family law matter, contact HD Family Law today to schedule your initial consultation.
