Under the terms of a divorce agreement, Lanny was to pay his wife Joyce $2,000 per month in alimony and $500 per month in child support.For a twelve-month period, Lanny can deduct from gross income (and Joyce must include in gross income):

Question

Quizplus · Accepted Answer

Under the tax law prior to 2019, alimony payments are deductible by the payer and taxable to the recipient. Therefore, Lanny can deduct $24,000 (12 months x $2,000) in alimony payments from his gross income. Child support is not deductible.

Under the Terms of a Divorce Agreement, Lanny Was to Pay