A New Year Brings Big Changes for Spousal Support

Going through a divorce can be devastating to your finances. Particularly if you relied on your spouse’s income, handling the costs and expenses you are likely to incur after a divorce can leave you feeling overwhelmed. Fortunately, there are situations in which you may be entitled to spousal support and maintenance, otherwise known as alimony. While this can help you get back on your feet, new changes in the tax code could impact your case and are something you need to consider.

Benefits of Spousal Support

If you make considerably less than your spouse or sacrificed your own career or education for the sake of your marriage, spousal support and maintenance can help you re-establish yourself financially after your divorce. Under the Illinois Compiled Statutes (750 ILCS 5/504b-4.5), there are three types of maintenance to which you may be entitled:

• Fixed Term Maintenance: Alimony for a specific period of time, such as while you finish your degree or get job training.
• Indefinite Maintenance: With no set expiration date, spousal support can be used to help a spouse maintain the same standard of living enjoyed during the marriage.
• Reviewable Maintenance: A spousal support award covers a specific period and is scheduled for review by the court after a certain time, to determine whether it should be stopped or modified.

In awarding spousal support, the courts have traditionally factored in information regarding each party’s income, earning potential, individually owned assets, and the length of the marriage. Potential tax benefits were often a factor in these awards as well.

Changes in Tax Code Impact Spousal Support Payments

Previously, paying spouses could deduct alimony payments from their federal tax returns, which often provided added incentive to pay. Likewise, the receiving spouse would have to claim these payments as income, which required advance planning to avoid year-end tax debts.

Under the Tax Cuts and Jobs Act (TCJA), which was enacted in 2017, there are major changes in the tax code, some of which are only now being implemented. In 2019, the Internal Revenue Service (IRS) will be implementing changes to spousal support which make it no longer a tax deduction, nor countable as income. As these changes could impact your divorce case, it is something you should discuss with an experienced Chicago divorce attorney right away.

Get the Guidance You Need From Our Chicago Divorce Attorney

At the Women’s Divorce & Family Law Group, we can answer your questions about spousal support, whether you are entitled to it, and how changes in the tax code could affect you. Contact our Chicago spousal support attorney online and request a consultation today.