When a couple files for divorce, it is highly unlikely that everything will be “fair.” These are two different people that have different careers, different objectives, and different needs. When they divorce, the goal of the court isn’t necessarily to make things perfectly even — it is to ensure that the two spouses have compliantly and appropriately divorced, and that any financial matters are as “fair” as they can be.
To this end, we would like to talk about alimony. Also called spousal support, alimony is compensation that one spouse pays to another after it is awarded by a judge. Determining the amount of alimony that is paid depends on the case, and there are myriad factors that go into finalizing how much alimony must be paid, and for how long.
Once it is determined, it is important for the spouses involved to keep track of the payments. There are two critical reasons why. The first is for tax purposes. The paying spouse can deduct his or her alimony payments from their taxes, while the receiving spouse must include those payments as part of their taxable income. The second reason is to protect yourself in case of divorce-related, or alimony-related, litigation.
The information you will want to track includes:
- The check number and bank account used
- The amount of the payment
- The date of the payment
- The address the check was sent from and the address it was sent to
- The paper receipt you create (and sign) if the paying spouse uses cash
Source: FindLaw, “Alimony Guidelines: What Records to Keep Regarding Your Alimony,” Accessed Dec. 6, 2017