Charles and Camillagot divorced in 2018. Under the terms of the decree Charles pays Camilla $50,000 in cash in each of the next five years (or until Camilla's death or remarriage). In addition, Charles transferred a castle worth $2,000,000 to Camillain 2018 and will pay $12,000 per year to support their son, Clyde, until he turns 19 years old. What amount (if any)is included in Camilla's gross income in 2020?
A)$2,062,000
B)$12,000
C)$50,000
D)$2,050,000
E)None of the payments are included in gross income.

Question

Quizplus · Accepted Answer

Camilla received $50,000 in cash each year under the divorce decree. Income from alimony must be included in gross income. The castle and the child support payments are not included in Camilla's gross income. Therefore, the correct answer is $50,000.

Charles and Camillagot Divorced in 2018