What could make divorces more contentious? The new tax law

The Chicago Tribune reports:

Divorcing couples may have a harder time settling their finances beginning next year due to a change in federal tax law, and attorneys warn that could add some bitterness to an already sour process.

Currently, people can write off alimony paid to ex-spouses, a point divorce attorneys often use to help reach settlements, since both parties can benefit. The person paying support is more willing to agree to higher payments because it reduces his or her taxable income, and the recipient gets more support. But the tax law President Donald Trump signed at the end of 2017 will eliminate that deduction for new divorce agreements, a move divorce attorneys fear could harm separating families and complicate a process often settled outside of the courtroom.


Without the deduction, the person paying alimony is being taxed on more income, said David Levy, founding partner of Chicago matrimonial law firm Berger Schatz. That’s also expected to leave less money for the person receiving the support, since there’s less in the pot to divide.

“They’re both being disadvantaged,” Levy said.

Alimony, also called maintenance or spousal support, can be awarded to either spouse and is decided through an agreement or a court order. Currently, the recipient is taxed on the money, but the new law shifts the tax burden to the payer.

For you rookies out thinking about divorcing.....