While many aspects of family law may stay the same over the years, certain components may also need to be changed to adhere to the evolving nature of life in the United States. Recently, the federal tax law was changed, with the change in the taxation of maintenance (alimony) payments that came into effect on the 1st of January 2019. According to the rules of this new law, maintenance payments delivered from one spouse to another can no longer be classed as a tax deduction for the payor. Additionally, the payee no longer has to count those payments as taxable income. What this means is that there can be greater resistance to the payment of maintenance than before.
The last update in the New York State maintenance guidelines was made at the time that maintenance payments were tax deductible to the payor and taxable income to the payee. These maintenance guidelines are still in place, and at as of the time of this blog have still not been revised by the New York State legislature. The law still reflects an environment wherein maintenance is tax deductible to the payor, and taxable income for the recipient. Accordingly the courts may decide to deviate from the guidelines for maintenance based on this change in the taxability, now that the rules are different, as deviation may be required to creating an agreement that’s fair for both parties. Continue reading