Podcast
Questions and Answers
How is alimony treated for tax purposes according to the information provided?
How is alimony treated for tax purposes according to the information provided?
Alimony is included in the taxpayer's gross income, but it is exempt for the recipient since March 21, 1962.
What are the components of payments received under a judicial order or written agreement of divorce?
What are the components of payments received under a judicial order or written agreement of divorce?
Payments can include alimony, allowances, or maintenance for either the recipient or their child.
Is alimony taxable for the recipient after March 21, 1962, and what does this mean?
Is alimony taxable for the recipient after March 21, 1962, and what does this mean?
Yes, alimony is taxable as gross income for the recipient, but it is exempt from taxation.
What legislation or rule change occurred regarding the taxation of alimony on or after March 21, 1962?
What legislation or rule change occurred regarding the taxation of alimony on or after March 21, 1962?
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In the context of divorce, why is it important to understand the tax implications of alimony?
In the context of divorce, why is it important to understand the tax implications of alimony?
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Study Notes
Alimony Received
- Taxpayer's Gross Income: Alimony or allowance or maintenance received under a judicial order or written divorce agreement is included in the taxpayer's gross income.
- Exemption for Recipient: Since March 21, 1962, alimony received is exempt from taxation in the hands of the recipient.
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Description
This quiz explores the taxation rules surrounding alimony received by taxpayers. Understand the implications of judicial orders versus written divorce agreements, and learn about the exemption for recipients that has been in place since 1962.
