Spousal Maintenance (Alimony) will no longer be deductible under Trump Tax Plan

Chicago Divorce and Alimony under new Trump Laws

Current tax law states that alimony (spousal maintenance) paid pursuant to a divorce judgment can be deductible to the person who pays and then is taxable to the person who receives it?  Why is this important?  The payor of alimony is usually in a higher tax bracket that the payee.  Thus, if the payor is able to save on taxes, he/she can afford to pay more to the payee.  The payee is usually in a lower tax bracket and will pay less taxes on the money than the payor.

Beginning January 1, 2019 is deduction will no longer exist.  It will be allowed indefinitely for divorces that were entered on or before December 31, 2018.

Will the new affect divorcing couples where alimony is paid?  Yes, it will it in most cases.  The couple, as a unit will no longer have the tax savings tool of taxable maintenance and will have less money overall to maintain two households.