How is alimony taxed? What about child support?
Alimony is income to the recipient and a deduction to the payer. Child support is neither income, nor a deduction. Often, a client claims they have an alimony deduction, when in fact the “alimony” was actually deemed child support by the divorce documents and is considered a non-deductible expenditure. Divorce and separation papers must be carefully worded in order to avoid losing tax-favored advantages.
