Spousal support is payments made by one spouse to the other after a separation or divorce. Also known as alimony, it is not required and it is determined by a judge on a case-by-case basis. The recent trend is to not award alimony, but it is still offered in cases where one spouse earned substantially more than the other over the course of the marriage, or where one spouse stayed home to care for the house and the children. In most cases, spousal support is tax deductible for the payer and it is taxable for the payee.
Guidelines for Spousal Support: What the Payer Should Retain
The person responsible for spousal support payments should retain certain documents. Each payment made should be listed, including check numbers, mailing address and a copy of the check, if possible. Most banks offer checks that come with carbon copies; be sure to include the purpose of the check in the memo section. Receipts for cash payments should be kept, and a Divorce Lawyer in Port Orchard WA will recommend that they should be signed by the receiver.
As with any documents required during an IRS audit, payers should keep these records for a minimum of three years from the date of the return where the deduction is claimed. Some experts even recommend that payers never throw these records away, as they can prove that alimony was paid years after the fact.
What the Payee Should Keep
The spouse receiving alimony payments should retain a list that keeps a record of each payment received. It should include the following information:
* The date of receipt
* The amount paid
* The check or money order number
* The account on which the payment is drawn
* The issuing bank
* A copy of the money order or check
* A copy of signed payment receipts
Just as is true with payers, a Divorce Lawyer in Port Orchard Wa will recommend that a person receiving spousal support should retain records for a minimum of three years in case of an IRS audit. Moreover, if a person feels that a former spouse is delinquent on support payments, they can take those records to court to show when payments stopped and to demand that the arrearage be caught up.