New Jersey Divorce Lawyers: Taxability of Pendente Lite Support
The Devil is in the Details
A very common and valid concern that many women have after the Complaint for Divorce is filed is how, as the lower earning spouse, they will support themselves and their children while the divorce is ongoing.
To remedy their valid concern, their matrimonial attorney will file a Motion for Pendente Lite support. This Motion, when granted by the Judge, will provide the lower earning spouse with temporary monetary support called “pendente lite” support. Pendente lite support is temporary, meant to last for the duration of time up until the Judgment of Divorce is entered.
Pendente lite support is also unallocated, meaning it is not specifically alimony nor child support; it is meant to cover all expenses for the family on this temporary basis.
Unallocated pendente lite support payments are treated as alimony and taxable to the recipient for federal taxation purposes UNLESS there is specific language in the Court Order granting the relief that the award of support is not alimony for tax purposes, is not deductible by the paying spouse and not taxable by the receiving spouse.
See the case of Kean v. Commissioner of Internal Revenue, 407 F.3d 186 (3d Cir. 2005), wherein the Third Circuit affirmed two consolidated rulings of the tax court, concluding that unallocated support payments received by the supported spouse during tax year 1992 through 1996 met the definition of alimony, resulting in tax deficiency assessments. The court stated that “where support payments are unallocated, as in this case, the entire amount is attributable to the payee spouse’s income.” Id. at 192.
As you can see, the proper handling of a pendente lite support in a divorce matter can have very serious tax consequences. For more information regarding pendente lite divorce matters, contact Lyons & Associates. Our skilled divorce lawyers in New Jersey represent men and women throughout New Jersey who have unresolved family law matters. We place a premium on personalized service and attention. For a private consultation, contact us online or call our offices at 908-575-9777.