Is Alimony Taxable?

For federal income tax, the answer is “Yes” and “No,” depending on your divorce agreement date or last modification.

THE RULES

Generally, for agreements entered before January 1, 2019, alimony (separate maintenance payments) is taxed to the recipient spouse and deductible by the payor. The payor doesn’t have to itemize deductions to claim alimony paid. However, for agreements entered in 2019 and later, alimony is neither taxed to the recipient nor deductible by the payor.

AVOIDING TAXATION

If your divorce was before 2019, you can avoid future tax on alimony you receive by having your legal professional amend your agreement. The amendment must explicitly spell out that the repeal of the deduction for alimony payments now applies to payments under your divorce agreement.