Hello,


As the title states can I claim the alimony I paid in 2018 on my tax return?


Also, the payments were made as gifts to my parents' account in a foreign country which was then transferred onto my ex-spouse as a check from their account so I'm not sure if it's still possible or not?


Thanks.

Alimony received is considered income and alimony paid is a deduction as an adjustment to income, even under the new tax law.

The fact that you weren’t divorced until 2019 complicates this. Was there a divorce or separation agreement in place in 2018 that mandated the payment? Under the new tax law, alimony paid under divorce or separation agreements executed after Jan 1 2019 are NOT deductable. See: https://www.marketwatch.com/story/new-tax-law-eliminates-alimony-deductions-but-not-for-everybody-2018-01-23

@AtlantaTaxExpert
My ex-spouse was an NRA. Further, does the IRS require proof that the funds I transferred were the ones used to make this one time payment?

@ebaines
Yes, the divorce was settled in a foreign country and required me to pay a one time alimony before the divorce was finalized.

They may, but as long as she had a SSN, it should not be a problem.

@AtlantaTaxExpert

She didn't have a SSN

That complicates matters, because the alimony payment to a non-resident alien is subject to 30% tax withholding. If you withheld the 30% as required and sent the withheld tax to the IRS, then the alimony is deductible.

What is her native country?

India and no I didn't withhold 30%

You have lucked out, because the U.S.-India Tax Treaty specifically states that alimony paid to a resident of India can be taxed ONLY by India. That being the case, there is no withholding requirement.

You may want to have your return when you deduct the alimony to be prepared by an expert who has experience in this matter because Form 8833 will need to be filed to explain to the IRS that the alimony, which is deductible for you, is NOT taxable income for your ex-spouse.

If you want my help, contact me at [email protected].

Thanks for the detailed explanation!

How will I prove that the funds I sent to my parents were used in paying for the alimony? Also, technically I wasn't divorced in 2018 so I don't know if that presents any more complications?

If the divorce was NOT final prior to 2018, then you cannot deduct the alimony as ebaines said.

I'll try to re-visit it next year, not sure if it will still be valid or not though.

No problem!