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Is the lump sum payment of an arrears amount of alimony completely taxable in the year in which it was finally paid?

| Feb 19, 2016 | Uncategorized

Q:  My girlfriend recent was awarded 2 years worth of previously unpaid alimony by her ex-spouse. He had taken it upon himself to simply stop paying, although he absolutely had the means to. He had unsuccessfully filed a motion to terminate spousal maintenance 2 years ago, and the judge ruled against him. The ex-spouse didn’t agree with this ruling and stopped paying his court ordered monthly amount anyway.

After retaining an attorney and taking her ex to court, just prior to the willfulness hearing, her ex’s attorney stated that his client would pay the 2-years worth of arrears in it’s entirety in order to forego the scheduled hearing.

Does my girlfriend now need to claim this 2 year, lump sum payment all as alimony paid solely this year? This amount should have been paid over 2 years and will greatly increase the tax burden on her by claiming 2 years worth of alimony in one year, instead of over 2 years, as it would have if her ex had actually made his court order payments when he should have. The amount of the arrears paid is greater than her annual salary.

A:  David’s Answer:  While this is more of a tax question (and thus she’s best advised to ask her accountant), generally alimony is considered taxable to the recipient as income in the year in which it’s received. Thus, if it’s alot, then she may wish to consider accepting some of it this year & some of it in 2017. Schedule a consult with a White Plains Alimony attorney for more info.

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