As a divorce lawyer for the past three decades, I have seen a lot of ways in which divorce affects a family. There are obviously the emotional ways, the financial ways, and finally the way the law plays into these dynamics.
It is my job to stay on top of the law so that I can help my clients navigate their ways through these changes.
The past two years have brought major modifications to Illinois family law. You can read here and here some ways these changes have affected families going through divorce.
2019 also is seeing some changes to family law, mostly in the areas of spousal maintenance which used to be known as alimony.
Tax Implications on Spousal Maintenance
2019 is the first year that spousal support payments are not tax deductible for the payor and do not count for income for the recipient’s income tax. In the past, spousal maintenance was tax deductible, but in 2019 a new federal tax law changed this.
Starting January 1, 2019, spouses who pay alimony no longer receive a taxable deduction, and those who receive alimony no longer have to report it as income.
For now, this only applies to those divorces that take place in 2019 and beyond. Divorces that occurred before 2019 will continue to enjoy the tax benefits that they currently do.
How Spousal Maintenance Is Calculated
The tax law that is taking effect in 2019 also changes the way spousal maintenance is calculated. Previously, it was calculated using gross income (before taxes). Now, it will be calculated using net income (after taxes).
There is an entire new formula that is being introduced that will affect all families whose combined annual gross income is less than $500,000 and if the payor doesn’t have an obligation to pay child support or spousal maintenance from a past relationship.
To learn exactly what this new formula is, talk with a divorce lawyer, or this article does a good job of explaining.
Contact Me
If you have questions about how these laws affect you, call me right away. I know that these laws are not just changes for lawyers to learn, but have real impacts on peoples’ lives. You deserve to fully understand your financial obligation.
Call (312) 621-5234 to schedule a consultation.
