Bergen County divorce lawyer Paul Goldhamer, Esq. is a founding partner at Kantrowitz, Goldhamer & Graifman. In addition to practicing matrimonial and estate law, Mr. Goldhamer maintains a full schedule of teaching, speaking engagements, and media appearances. Mr. Goldhamer was selected in 2014 as a “Super Lawyer” by Superlawyers.com.
From Paul Goldhamer:
When it comes to alimony, the new tax law is going to turn the calendar back 77 years. That was when the Revenue Act of 1942 first made alimony deductible for the spouse paying it and taxable for the spouse receiving it. The deduction was granted to help couples make the transition from being joint taxpayers to paying separately, said Suzanne L. Shier, chief tax and wealth planning strategist at Northern Trust.
The tax change could become problematic in divorces settled after Dec. 31, 2018, because one spouse will gain a tax benefit and the other will lose a deductible item. Under the new system, the alimony payer will be taxed on the full amount while the recipient will receive the payment tax free. The obvious answer is to complete the agreement by the end of the year to preserve the deduction. But, this is easier said than done.