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New Tax Plan Impacting Divorce Rates?

| Apr 26, 2018 | Uncategorized

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Although the divorce rate is already high, there are some current charges being made that have been making a current impact on couples who are debating getting a divorce or not. More and more individuals have been reaching out the lawyers asking about this new tax law that is planned to take
There is a new tax law that Donald Trump has signed in December that will make paying alimony more expensive for individuals getting divorced in the year 2019 and on.
With this change, more individuals have been asking lawyers about it. Some couples have been considering getting a divorce sooner rather than later. They are trying to get the divorce settled before the new tax charge.
Although finances are definitely something that majorly impacts couples, the decision whether to divorce or not will make an even greater impact in the lives of these couples. A change in tax should not make you immediately decide to take the plunge. Take your time when making this decision.
As of right now, the person paying alimony or spousal support may be able to deduct those payments from their taxes. If a person pays $20,000 in spousal support per year, and are in the 33% tax bracket, the can get a deduction of $6,600 per year, according to Moneyish.
In 2019, you will no longer be able to deduct the alimony payments from your taxes. This means that you will be spending a substantial amount more.
If you finalize your divorce in 2018, you will still be able to get a deduction on your alimony payments for the time that you are required to pay it.
For the individuals who receive alimony or spousal support, they have to pay taxes on it. The individuals who get this in 2019 or later, will not.
Want to learn more or have any questions? Give us a call!

Source: Moneyish