As someone navigating an Alaska divorce in 2019, you will have to navigate certain tax changes that did not affect those who divorced prior to this year. At Kalamarides & Lambert, we recognize that this year’s new tax changes can have a substantial effect on parties who divorce this year and moving forward, and we have helped many clients understand the tax implications of divorce and navigate numerous other issues relating to it.
According to Forbes, one of the most significant tax changes that will impact you when you divorce this year involves spousal support payments. Until this year, the person paying spousal support after a divorce would get to deduct the amount of support paid from his or her taxable income, resulting in a nice little tax break for the paying party. The party on the receiving end of the spousal support payments, meanwhile, would include the amount received as part of his or her taxable income for the year.
Starting this year, though, this no longer applies. Because the person paying spousal support will no longer receive this tax benefit, he or she may be more likely to fight hard not to have to pay support at all, which may lead to longer court battles and drawn-out divorce proceedings. Another important tax law change that took effect this year involves the elimination of the exemption parents can receive for having kids.
In years past, the parent that claimed a child as a dependent could get an exemption for doing so, but this no longer applies. The government did, however, double the amount parents get for a child tax credit, but in many cases, kids are no longer the tax deduction they once were. You can learn more about family law on our webpage.