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Alimony tax changes to come in 2019

Divorce can be complicated, especially if a couple cannot come to an agreement in regard to alimony payments. To further complicate matters, a tax change is on the horizon that will potentially cause drawn-out divorces and contentious disputes. Maryland couples considering a divorce may want to contact an attorney to finalize matters in 2018 to avoid being locked into the new alimony tax law.

Come Jan. 1, 2019, a 75-year-old tax deduction for alimony payments will cease. While the financier can no longer use the payments as a tax write off, the recipient will no longer need to pay taxes on the alimony received. Though the new law appears to benefit the recipient, that individual may not receive as much money in the absence of the current tax deduction.

With these changes, it has been speculated that the supporting spouse will no longer be inclined to agree to an elevated payment, potentially leading to litigious arguments between the parties. For decades, the tax deduction from gross income has been a motivation for the spouse making alimony payments. By removing this motivation, the issue of alimony may become more difficult in starting next year.

The upcoming 2019 tax law will not affect those currently under an alimony obligation or those who wrap up their divorce prior to Dec. 31, 2018. Regardless of the projected timeline, it will be beneficial to consult a Maryland divorce attorney to discuss the upcoming changes and how it may affect one's divorce. An attorney can offer advice and support through an alimony negotiation and advocate for the most beneficial outcome for the client.  

Source:, "Tax cut act switches alimony tax burden in 2019", Reeves Mahoney, April 6, 2018

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