Having an alimony arrangement requires diligent recordkeeping

On Behalf of | Apr 13, 2018 | Divorce

Whenever a major financial transaction takes place, the parties involved want to make records of these moments to prove and validate that the transaction occurred. The information included in these records is critical, and it behooves both parties to secure these records for reference later (if necessary).

The same principles outlined above apply to spousal support (which was once called alimony). When spousal support is awarded after a divorce, both spouse should consider keeping track of every payment they make or receive.

There are a couple of good reasons for this. The first is that there are tax implications to spousal support. For the paying spouse, they can deduct those payments from their taxable income. For the receiving spouse, they must include the payments as part of their taxable income. Beyond this though, if any litigation were to occur in the future relating to either the divorce or their spousal support arrangement, it is very beneficial to have these records to point to.

So what kind of information should you collect on these payments? All of the simple facts are important. This means the check number, the amount of the payment, the date of the payment, the addresses used, the bank used, and the account type and number utilized should all be tracked. If the paying spouse either refuses to use checks or simply can’t use checks, then a hand-made receipt should be created (that you both sign) to signify the completion of a cash transaction for spousal support.

Source: FindLaw, “Alimony Guidelines: What Records to Keep Regarding Your Alimony,” Accessed April 13, 2018

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