Legal Question in Family Law in Virginia
Is It Alimony
Charles Homiller responded to a previous question on 2/17/06, same subject. I'm not sure I agree it is a distribution of marital assets. The distribution of marital assets went away when the divorce decree was amended. IRS says ''A payment to or for a spouse or former spouse under a divorce or separation instrument is alimony if the payment is made by cash, check, or money order'' and ''the instrument does not designate the payments as ''not alimony''.'' Payment is made by EFT directly from my husband's checking account to hers. And the amended divorce decree does not designate the payments as ''not alimony.'' It should have if it were a distribution of marital assets. It says the sum shall be paid directly to ex-wife (IRS's definition of alimony) and shall not be taxable(?). But should it be? If this were a marital asset and she received it from OPM, it would be taken off the top of my husband's pre-taxed retirement and the amount she received would be taxed prior to her receiving it. Plus she would be required to report it to IRS as income. My gut feeling tells me it's alimony (the instrument doesn't say it's not and IRS says it is). Do you still feel it's a marital asset rather than alimony and is it taxable?
1 Answer from Attorneys
Re: Is It Alimony
I have reviewed your original question as well as Mr. Homiller's response posted on 2/17/06. It appears to me that your husband's former wife gave up her right to receive aliimony in return for a higher % of your husband's civil service retirement benefits which she will be entitled to receive until her death(even if she remarries) which is a telling clue that in fact
these payments are intended as part of an equitable distribution of marital assets from the dissolved marriage and are not alimony. If it were alimony, the former spouse would have her payments terminated in the event that she were to remarry. There is no such provision in the decree amended via consent of the parties.
I therefore agree with Homiller's assessment. I assume that your interest in this matter derives from the possiblity of your husband claiming a tax deduction on your current joint federal return if in fact he could claim these payments as alimony or spousal support--which, apparently, they in fact are not.
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