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Ensuring that spousal support is tax deductible

When couples divorce in Texas, courts often order the the higher-earning spouse to pay alimony. While paying spousal support may seem unpleasant, the payments are tax deductible as long as they adhere to the rules set by the Internal Revenue Service.

The IRS allows a deduction for alimony only if the payments are set up according to their guidelines. In such cases, the individual receiving support will have to pay income tax on the alimony.

In order to deduct alimony, the payments have to be made under a valid court order or legal separation agreement. The order or agreement may not designate the spousal support as child support, and the payor spouse must either make the payments to the ex-spouse directly or a third party for the ex-spouse's benefit. Orders and agreements cannot call for an ongoing payment obligation that extends beyond a spouse's death. For the payments to be deductible, the spouses may not continue sharing a home or filing joint tax returns.

In addition to spousal support, there can be many complex issues that must be determined in divorce cases. People may want to consult with family law attorneys if they wish to get divorced. Lawyers may be able to analyze the situations and advise their clients about what they might expect. They may also offer advice about potential tax consequences that could occur with different types of asset distributions. If the spouses are unable to reach agreements, the lawyers may litigate their clients' cases in court and then review the orders to make certain that the language is suitable.

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