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Summary George pays Mary $50,000 each year as part of what the courts call alimony. The amount is $7.99   Add to cart
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Summary George pays Mary $50,000 each year as part of what the courts call alimony. The amount is

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George pays MaryGeorge pays Mary $50,000 each year as part of what the courts call alimony. The amount is reduced to $30,000 each year once Tommy, their son, reaches 21 or dies. How much of the payment, if any, is considered child support for tax purposes?Answer & ExplanationFor tax purposes, the I...

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  • October 6, 2024
  • 2
  • 2024/2025
  • Summary

Subjects

  • 000 each year once tommy
  • their son
  • if any
  • george pays marygeorge pays mary 50
  • 000 each year as part of what the courts call alim
  • reaches 21 or dies how much of the payment
  • is considered child support

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George pays Mary $50,000 each year as part of what the courts call alimony.

The amount is reduced to $30,000 each year once Tommy, their son, reaches 21

or dies. How much of the payment, if any, is considered child support for tax

purposes?




Answer & Explanation


For tax purposes, the Internal Revenue Service (IRS) distinguishes between

alimony and child support. Alimony is generally deductible by the payer and

taxable to the recipient, while child support is neither deductible by the payer

nor taxable to the recipient.


In this scenario, George pays Mary $50,000 each year as alimony. However, this

amount reduces to $30,000 once Tommy reaches 21 or dies. This reduction in

payment is contingent upon a condition related to their son Tommy.


According to IRS rules, if any portion of an alimony payment is reduced due to

a contingency related to a child (such as reaching a certain age), that portion of

the payment is considered child support for tax purposes.

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