|
Posted by KEBSCHULLW on October 17, 2007, 2:09 am
Please log in for more thread options
>> I was a widower with twin sons age 2 when I remarried in
>> 2003. My second wife was divorced with a son age 4. In May
>> of 2007, I was promoted and transferred from Indianapolis to
>> Atlanta. She refused to relocate and we legally separated.
>> The property settlement has me paying $500 per month against
>> the home equity loan on an addition made to her house to
>> accommodate me and my sons and it gives me a 30% lien on the
>> house less the balance of the addition. I pay directly to
>> the bank.
>>
>> I have my sons. She has her son. We had no children
>> together. I say we can both file as unmarried heads of
>> household. I also say I can deduct the interest on the home
>> equity loan payments. The first two tax pros I interviewed
>> say we'll both get audited if we do that and that the loan
>> payments should be classified as non-dedcutible alimony.
>>
>> Am I out to lunch or are they?
> Them, at least mostly.
>
> Based on the facts you presented both you and and your wife
> qualify for head of household filing status.
>
> It is less clear whether your house payments should be
> characterized as alimony. However, if the payments are
> alimony then they are deductible by you and reportable by
> your wife as income. As far as I know, there is no such
> thing as "non-deductible alimony."
Actually, some alimony that was deducted in a prior year may
have to be recaptured! I guess that would make the
recaptured alimony non- deductible.
Here is what IRS publication states,
Recapture of Alimony
If your alimony payments decrease or terminate during the
first 3 calendar years, you may be subject to the recapture
rule. If you are subject to this rule, you have to include
in income in the third year part of the alimony payments you
previously deducted. Your spouse can deduct in the third
year part of the alimony payments he or she previously
included in income.
Cheers,
WDK
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
| 
Yahoo! 
Google 
Windows Live 
del.icio.us 
digg 
Netscape 
XML Sitemap