Is Unallocated Support Tax Deductible?

Question:

I just read your divorce tax tips article that said child support was not tax deductible, but alimony is.

My understanding is that unallocated family support payments are fully deductible by the paying spouse and fully taxable to the recipient spouse if the divorce decree specifies that the amount being paid is unallocated support.

Is this true? Is unallocated support tax deductible?

Answer:

I am unable to give you legal advice on divorce. I can give general divorce help for men, though, my knowledge is based on Illinois child support laws where I am licensed to practice.

“Unallocated family support” is a label which can be applied to the combination of child support and alimony payments which can make all or a portion of the payment deductible by the payor and taxable to the payee.

However, the specific language of the court order setting the support will determine whether the payments are deductible as alimony. Simply designating the support as “unallocated support” is not sufficient to satisfy the IRS regulations.

According to the IRS regulations, payments made to a spouse must meet certain requirements to be considered alimony, and therefore be tax deductible to the payor and taxable to the recipient.

Additionally, in order to be tax deductible to the payor and taxable to the payee, certain requirements must be met to establish that the payments are not child support.

Therefore, if all or a portion of the unallocated support payment does not meet the requirements to be considered alimony, or if a portion of the payments are considered child support, that portion of the unallocated support payment may not be deductible to the payor spouse.

If your court order contains an award of unallocated support payments, you should review the language of the order with a tax professional or attorney to determine whether the payments meet the IRS requirements to be deductible as alimony.

Remember, I am unable to provide you with anything more than divorce tips for men, so please consult with a divorce lawyer in your jurisdiction.

Note: This information is general in nature and should not be construed as tax advice. You should work with your attorney or tax professional to determine the tax advantages that will work best for your situation.

To schedule an appointment with a Cordell & Cordell mens divorce attorney, including Belleville Divorce Lawyer Erin Brockhoff, please contact Cordell & Cordell.