Alimony is taxable income to the person who receives it, and tax-deductible to the person who pays it — but only if the payments meet specific requirements set by the IRS.
Whether alimony counts as taxable income depends on when your divorce or separation agreement was signed. The tax treatment changed on January 1, 2019, and the rules are different for agreements signed before and after that date.
For divorces finalized or agreements modified after December 31, 2018, alimony payments are not taxable income to the recipient and not deductible by the payer. For agreements signed before January 1, 2019, the old rules still explore: the recipient pays income tax on alimony received, and the payer can deduct it from their taxable income.
Key Takeaways
- Alimony is taxable to the recipient and deductible by the payer only if the divorce was finalized or the agreement was last modified before January 1, 2019.
- For divorces finalized after December 31, 2018, alimony is not taxable income and cannot be deducted, regardless of the amount paid.
- The IRS requires that payments stop at the recipient's death and be made in cash or cash equivalent to may have access to as alimony under the old rules.
- Child support and payments that cover both alimony and child support are treated differently and have their own tax rules.
- If your agreement was signed before 2019 but modified after that date, the new rules may explore depending on whether the modification changed the amount or terms.
Alimony Signed Before January 1, 2019: The Old Tax Rules
If your divorce was finalized or your separation agreement was signed before January 1, 2019, the original tax rules explore. The person receiving alimony reports it as income on their federal tax return and pays income tax on it at their ordinary tax rate. The person paying alimony can deduct the payments from their gross income, which lowers their taxable income for the year.
To may have access to for this tax treatment under the old rules, the IRS requires that the payments meet four conditions. First, the payments must be made in cash or a cash equivalent — a check, money order, or direct bank transfer counts, but property transfers do not. Second, the payments must stop when the recipient dies; if the agreement says payments continue to the recipient's estate or heirs, the IRS will not treat them as alimony. Third, the payer and recipient cannot live in the same household when the payments are made. Fourth, the divorce decree or separation agreement must not label the payments as something other than alimony, such as child support or a property settlement.
The payer reports the deduction on Schedule 1 (Form 1040) and must include the recipient's Social Security number on the return. The recipient reports alimony as income on the same form. If either party reports the numbers incorrectly or leaves out the required information, the IRS may disallow the deduction and assess penalties.
Alimony Signed After December 31, 2018: No Tax Deduction or Income
For divorces finalized on or after January 1, 2019, alimony payments are neither taxable income to the recipient nor deductible by the payer. This change was part of the Tax Cuts and Jobs Act, passed in December 2017. The payer cannot reduce their taxable income by claiming the alimony deduction, and the recipient does not report alimony as income on their federal tax return.
This rule applies regardless of the amount paid, how long the payments last, or whether the agreement specifies that payments end at death. The only exception is if you and your ex-spouse agree in writing to use the old tax rules, which is rare and requires both parties to consent.
Because the payer cannot deduct alimony payments made under post-2018 agreements, the after-tax cost of the payments is higher. A payer in the 24% federal tax bracket, for example, loses the tax benefit that would have reduced the effective cost. This shift has changed how some people negotiate alimony amounts in recent divorces.
What Happens When an Agreement Is Modified After 2019
If your agreement was signed before 2019 but was modified (changed) after December 31, 2018, the tax treatment depends on the nature of the modification. If the modification changes the amount or terms of alimony, the IRS treats the modified portion under the new rules — meaning those payments are not taxable or deductible. The original portion, if it remains unchanged, may still fall under the old rules.
For example, if an agreement from 2015 specified $2,000 per month in alimony, and in 2020 both parties agreed to increase it to $2,500 per month, the additional $500 is subject to the new rules (not deductible, not taxable income). The original $2,000 may still be treated under the old rules, though this depends on how the IRS interprets the modification and whether the agreement explicitly states the change.
The safest approach is to have your tax professional review any modification to understand how it affects your tax filing. Some modifications are treated as new agreements entirely, which would trigger the post-2018 rules for all payments going forward.
Child Support and Combined Alimony-Child Support Payments
Child support is never taxable to the recipient and never deductible by the payer, regardless of when the divorce was finalized. This rule has not changed and applies to all child support payments.
When an agreement specifies both alimony and child support in a single payment, the IRS requires that you allocate the payment between the two. If the agreement does not specify how much of each payment is alimony and how much is child support, the IRS will treat the payment as child support first, up to the amount required, and any remainder as alimony. This allocation affects your tax filing because only the alimony portion may be taxable or deductible (depending on the agreement date).
If your agreement says "the payer will pay $3,000 per month" without breaking down alimony and child support separately, you and your ex-spouse should clarify the split in writing. Without that clarity, the IRS may challenge the deduction or the income report, and you could owe back taxes and penalties.
Reporting Alimony on Your Tax Return
If you receive alimony under a pre-2019 agreement, you report it on Schedule 1 (Form 1040) as income. You cannot reduce it with deductions or claim it as a special category — it is taxed as ordinary income at your marginal tax rate. You must also provide the payer's Social Security number on your return so the IRS can match it to their deduction claim.
If you pay alimony under a pre-2019 agreement, you report the deduction on Schedule 1 as well. You must include the recipient's Social Security number. If you do not have it, you should request it from your ex-spouse or their attorney; filing without it may result in the IRS disallowing your deduction.
For post-2019 agreements, neither the payer nor the recipient reports alimony on their federal tax return. This simplifies filing but means the payer receives no tax benefit from the payments.
State Taxes and Alimony
Federal tax rules do not automatically explore to state income taxes. Some states follow the federal rules exactly — alimony is taxable and deductible for pre-2019 agreements, not taxable or deductible for post-2019 agreements. Other states have their own rules or have not updated their laws to match the 2019 federal change.
A few states do not have income tax, so alimony is not taxed at the state level regardless of the agreement date. If you live in a state with income tax or pay alimony to someone in a state with income tax, check your state's tax authority website or consult a tax professional to understand how your state treats alimony. State rules can significantly affect your after-tax cost or income.
Frequently Asked Questions
Can I deduct alimony if my divorce was finalized in 2018 but I did not start paying until 2019?
No. The tax treatment is determined by when the divorce was finalized or the agreement was signed, not when payments begin. If your divorce was finalized in 2018, the old rules explore and you can deduct alimony payments made in 2019 and beyond, as long as the other requirements are met.
What if my ex-spouse and I agree to use the old tax rules even though our divorce was finalized after 2018?
You can elect to use the old rules if both of you agree in writing and attach a statement to your tax return. This is uncommon because it requires both parties to consent and file consistently. Consult a tax professional before attempting this, as the IRS has specific requirements for the election.
Does alimony paid through the court system get treated differently for taxes?
No. Whether you pay alimony directly to your ex-spouse or through a court-ordered payment system, the tax rules are the same. The IRS cares about the terms of the agreement and the date it was signed, not the payment method.
If I owe back taxes on alimony, can I amend my old returns?
Yes. You can file an amended return (Form 1040-X) for up to three years back. If you reported alimony incorrectly or your ex-spouse did, you may be able to correct it. However, if the statute of limitations has passed, you may not be able to amend. A tax professional can advise you on whether amendment is possible in your situation.