Question

Frank legally divorced his wife last year. His ex-wife has joint ownership of their home and sole custody of their two children. As part of the divorce decree (dated June 1, 2018), Frank was ordered to continue to pay the full mortgage payments as well as cash payments to his ex-wife. Frank was also ordered to pay child support for the children. Frank pays the following amounts: • Alimony in the amount of $1,300 cash per month • Mortgage payments in the amount of $1,800 per month • Child support in the amount of $800 per month How much can Frank deduct as alimony? Select one: a. $26,400 b. $46,800 c. $37,200 d. $36,000?

Answer 1

Answer is Option C.

The Following payments are not considered as deductions for Alimony;

1. Child Support,

2. Non cash property settlements, whether in a lump-sum or installments,

3. Payments that are your spouse's part of community property income,

4. Payments to keep up the payer's property,

5. Voluntary payments (that is, payments not required by a divorce or separation instrument and

6. Use of the payer's property.

So, Child support of $ 800 per month will not be considered.

Amount of deduction as Alimony is as follows;

Cash payment is $ 1,300 * 12 = $ 15,600

Mortgage Payments is $ 1,800 * 12 = $21,600

Total deduction as Alimony is ( $ 15,600 + $ 21,600 ) $ 37,200.