Laura Dale & Associates, P.C.
Se Habla Español Nous Parlons Français
Call 713-574-7952 or 888-572-6059
888-572-6059

Retirement, alimony and the new tax rule

Couples who decide to file for divorce in Texas may be ordered to pay alimony as a part of the divorce settlement. Alimony is designed to help people who are dependent on their spouse’s income, to get on their feet, make ends meet and maintain a certain quality of life once the divorce is finalized.

The Tax Cut and Jobs Act, which will take effect in 2019, will affect the way people deduct their alimony payments from their income taxes. Currently, people who pay alimony to a former spouse are able to deduct their payments from taxes, and the people who receives the alimony payments are responsible for paying taxes on that money. Under the new change, however, alimony is not deducted and recipients are no longer required to pay taxes on the money received.

People should keep in mind that the new alimony rule only affects couples who divorce in 2019, once the regulations take go into effect. One way people can implement the new rule is by paying their spouse’s alimony out of their IRA. The money is taken out of the retirement account, which are funds that are untaxed, and then used as an alimony payment. The recipient of the alimony must pay taxes on that money, as they did previous to the new law.

Filing for divorce may seem overwhelming, but an attorney from Texas can simplify the process. They can sit down with you and explore all of your legal options, as well as help you make the right choice for your situation.

Source: CNBC, “Two surprising ways the new alimony tax rules affect your retirement savings,” Lorie Konish, Aug. 14, 2018.

No Comments

Leave a comment
Comment Information

Client Testimonials

  1. Laura Dale the best Family Law attorney I have ever met... Posted by John...Listens, takes your calls, tells you the truth (even when it may not be what you want to hear)... Read More

  2. The Best...Posted by a Child Custody client... Laura Dale handled my international child custody and divorce matter. I am an attorney in Houston and was referred to her... Read More

  3. A Meticulous, Knowledgeable, Attorney with Heart...Posted by a Child Custody client... Laura was not the first attorney that my husband and I interviewed for an extremely complex... Read More

  4. Top Notch, Hands Down - The Best...Posted by Tammi, a Child Custody client... Laura Dale has been absolutely the best attorney I could have found for my difficult child custody... Read More

Contact Our Experienced Team Today | Se habla español | Nous parlons français

Due to the experience our lawyers have in many specialized areas, you can rely on us to put together the right team to handle your case, even if it centers on complex issues such as international family law, business valuation or bankruptcy. Contact us today to make an appointment to discuss your needs with a knowledgeable lawyer.

Login to Client Portal

Laura Dale & Associates, P.C.
1800 Saint James Pl.
Suite 620
Houston, TX 77056

Toll Free: 888-572-6059
Phone: 713-574-7952
Fax: 713-600-1718
Houston Office Location

Review Us