Courtney ∙ Clark Law, P.C.Courtney ∙ Clark Law, P.C.
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Consider other payment options to replace alimony in divorce

Very soon, the strike of the clock at midnight will be the start of 2019. At that time, the familiar alimony tax rules will be replaced by the Tax Cuts and Jobs Act, which will make received alimony payments taxable income and alimony payments non-tax deductible. Anyone in Illinois whose divorce could not be finalized before New Year's Eve may want to look at other options to consider instead of alimony. It is essential to take into account that the new law will also affect other aspects of a divorce such as home ownership.

Under the new law, the same tax rules will apply to property division payments and alimony payments. One option is for the one spouse to receive his or her share of the property as payments to replace alimony. In this way, the spouse who needs support can receive his or her share of the property in regular payments instead of spousal support. However, these decisions must not be made in haste and preferably not without legal guidance.

Differences between property division and alimony to take into account include the fact that those property payments instead of spousal support can come to an abrupt end if there is a bankruptcy filing made by the paying spouse. Alimony payments, in contrast, will not be discharged in bankruptcy. Another difference is the fact that failure to pay alimony can lead to wage garnishments of up to 50 percent, while it will be no more than 25 percent if the division of property payments are not made.

Divorce attorneys in Illinois have had about a year to study the new Tax Cuts and Jobs Act, and anyone who considers ending a marriage might benefit from a consultation with such an attorney. The lawyer can assess the unique circumstances of the client before explaining the pros and cons of the various options. This will allow the client to make informed decisions about the most appropriate way for him or her to deal with matters that will have an impact on post-divorce financial stability.

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Courtney ∙ Clark Law, P.C.
104 South Charles Street
Belleville, IL 62220

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