Question

June's divorce decree calls for her to pay her former spouse, Johnathon, $500 a month as child support and $250 a month as alimony. June fails to pay Johnathon in May, August, and November. The divorce decree was finalized on July 1, 2018. The amount June may deduct as alimony paid is limited to __________.

Answer 1

So, the amount June may deduct as alimony paid is limited to $1500.

Explanation:

For tax purposes, alimony payments are deductible by the payer and considered taxable income for the recipient. However, there are specific rules regarding the timing and amounts of alimony payments.

In this case, the divorce decree calls for June to pay $250 a month as alimony. Since June fails to pay in May, August, and November, the amount she may deduct as alimony paid for the tax year is limited to the months she made the payments.

From July 1, 2018 (the date the divorce decree was finalized), to the end of the tax year, there are six months: July, August, September, October, November, and December. Therefore, June may deduct alimony paid for these six months.

The deductible alimony amount for the year would be 6 ($250) = $1500.

So, the amount June may deduct as alimony paid is limited to $1500.