Lawyers are counseling couples considering divorce to do it this year – before a 76-year-old deduction for alimony payments is wiped out in 2019 under the Tax Cuts and Jobs Act.
“Now’s not the time to wait,” said Mary Vidas, a lawyer in Philadelphia and former chair of the American Bar Association’s section on family law. “If you’re going to get a divorce, get it now.”
Potential divorcees have all of 2018 to use the alimony deduction as a bargaining chip in their negotiations with estranged spouses.
The deduction substantially reduces the cost of alimony payments — for people in the highest income tax bracket, it means every dollar they pay to support a former spouse really costs them a little more than 60 cents.