ASK THE EXPERT with Inside Business
By Reeves Mahoney
Apr 6, 2018
Have you been putting off finalizing your divorce? Well, you might want to sign on the dotted line by year’s end, or at least get a legal separation agreement in place.
The Tax Cuts and Jobs Act passed by Congress and signed into law by President Trump this past December wipes out a 75-year-old tax deduction dealing with alimony payments, starting Jan. 1, 2019.
For those who have been paying alimony — a husband’s or wife’s court-ordered payment for a spouse pursuant to a separation agreement or a divorce — don’t worry. This law won’t affect you. You can continue to deduct your alimony payments from your annual taxes, and, the recipient spouse must still claim the payments as income.
For those in the divorce process this year, the good news is the “old tax rule” of deductibility still applies until the deadline of Dec. 31, 2018.
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