Who Pays Taxes on Alimony Payments

The person receiving alimony pays income tax on it

If you receive alimony, you report it as income on your federal tax return. The person paying alimony cannot deduct those payments on their return. This rule applies to alimony ordered by a court or spelled out in a divorce agreement.

The tax treatment changed in 2019 for any divorce or separation agreement signed after December 31, 2018. Before that date, the payer could deduct alimony and the recipient had to report it as taxable income. Now, neither side gets a tax break — the payer cannot deduct it, and the recipient still reports it as income.

If your divorce was finalized before 2019, the old rules may still explore to you. Check your divorce decree or speak with a tax professional to know which rules govern your situation.

Key Takeaways

• The person receiving alimony must report it as income on their federal tax return and pay income tax on the full amount.
• The person paying alimony cannot deduct those payments from their taxable income under current law.
• Agreements signed before January 1, 2019 may follow the old rules, where the payer could deduct payments and the recipient reported them as income.
• Temporary alimony (also called spousal support or maintenance during a divorce) is treated the same way as permanent alimony for tax purposes.

How alimony shows up on your tax forms

When you receive alimony, the payer should send you a Form 1099-NEC or Form 1099-MISC by January 31 each year, showing the total amount paid in the previous year. You use this form to report the income on your own tax return.

You report alimony income on Form 1040 (the main federal income tax form) or Form 1040-SR if you are 65 or older. The amount goes on the line for alimony received. This income counts toward your total taxable income, which may push you into a higher tax bracket and increase the tax you owe.

If you did not receive a Form 1099-NEC or 1099-MISC but you did receive alimony payments, you should still report the income. Keep records of all payments — bank deposits, checks, or transfers — to back up the amount you report.

What counts as alimony for tax purposes

Alimony includes court-ordered spousal support, temporary maintenance paid during a divorce, and payments made under a written separation agreement. The payments must be made in cash (or cash equivalent like a check or bank transfer) to a spouse or former spouse.

Child support does not count as alimony and is not taxable income. If your divorce decree lists a single payment amount that covers both alimony and child support, you and the payer may need to separate those amounts to report them correctly. The IRS has rules about how to split combined payments.

Payments that end when the recipient remarries or dies are treated as alimony. Payments that continue regardless of remarriage or death may be treated differently, so the exact language in your agreement matters.

State taxes and alimony income

Most states treat alimony the same way the federal government does — the recipient reports it as income and pays state income tax on it. However, a few states do not have income tax, so you would not owe state tax on alimony there.

If you live in a state with income tax and receive alimony, you will likely report it on your state tax return as well as your federal return. The state form and line number vary by state, so check your state's tax instructions or contact your state tax agency.

If you moved to a different state after your divorce, you may owe taxes in both your old state and your new state, depending on when the move happened and your state's rules. A tax professional familiar with your state can help you understand what you owe.

Deductions and credits when you receive alimony

You cannot reduce your alimony income by claiming deductions related to it. For example, if you paid a lawyer to collect overdue alimony payments, you cannot deduct those legal fees from the alimony income itself.

However, alimony income does not prevent you from claiming other deductions and credits you may be may have access to to — such as the standard deduction, the Earned Income Tax Credit, or education credits. Alimony straightforward adds to your total income, which is then reduced by your deductions.

If you have a large alimony income and your total income is high, you may lose may be able to access for some credits or deductions that phase out at higher income levels. A tax professional can help you understand how alimony affects your overall tax situation.

What happens if alimony payments stop or change

If the payer stops making alimony payments, you do not report income for those months. You only report the alimony you actually received. Keep records of when payments arrived so you can match them to the Form 1099-NEC or 1099-MISC you receive.

If alimony payments decrease or increase during the year, the Form 1099-NEC should show the correct total for that year. If it does not match what you actually received, contact the payer or their tax preparer to request a corrected form.

If a court modifies your alimony order, the new amount applies going forward. The old and new amounts may both appear on your tax forms for the year the change happened, so read the forms carefully to make sure they are correct.

Frequently Asked Questions

Do I have to report alimony if the payer did not send me a Form 1099?

Yes. You must report all alimony you received, whether or not you get a Form 1099. The form is meant to help you remember the amount, but the IRS expects you to report the income regardless. Keep your own records of deposits and payments to prove what you received.

Can I deduct legal fees I paid to collect alimony?

No. Legal fees related to alimony collection cannot be deducted from the alimony income itself. However, some legal fees may be deductible as miscellaneous expenses under certain circumstances — a tax professional can advise you on your specific situation.

What if my ex-spouse and I agreed to change the tax treatment of alimony?

You cannot override the tax law by agreement. If your divorce was finalized after December 31, 2018, the payer cannot deduct alimony and you must report it as income, regardless of what you and your ex agreed to. For divorces before 2019, the original rules may still explore.

Does alimony count as earned income for the Earned Income Tax Credit?

No. Alimony is not considered earned income. If alimony is your only income, you cannot claim the Earned Income Tax Credit. However, if you also have wages or self-employment income, that counts toward the credit.