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March 27, 2008
Alimony--Tied to a Child's 18th Birthday
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Alimony--Tied to a Child's 18th Birthday
Posted by: Lee A. Schwartz
March 27, 2008
Topic: Alimony
In this Superior Court case, the Clearfield County Court awarded Wife alimony for "an indefinite period, to expire at the latest on December 12, 2017, the child's eighteenth birthday". Husband took issue with using the child's birthdate as the latest cut-off date for alimony.
Husband believed that the Internal Revenue Service would attempt to recapture the alimony payments and reclassify them as child support because they are a contingency involving the child. The Superior Court agreed with Husband, as the contingency of the alimony award would most likely result in a recharacterization of the alimony payment to child support. The Superior Court sent the case back to trial court to clarify the alimony award duration by eliminating the contingency in the alimony award.
Analysis: Alimony is deductible by the Payor (here the Husband) and is income to the Payee (here the Wife). By tying the duration of alimony to the emancipation of the child, the alimony payments "smell like" child support. The IRS could very well change the nature of the payments from alimony to support, which would defeat the intent of the court in awarding alimony. By tying the length of the alimony payments to some factor other than the age of the child, these payments pass the smell test.
