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Laura and Leon were granted a divorce in 2019. In accordance with the decree, Leon made...

Laura and Leon were granted a divorce in 2019. In accordance with the decree, Leon made the following payments to Laura in 2019: Child support payments contingent on the age of the child $4,000 Annual cash payments, other than child support, specified as alimony in the divorce agreement $6,000 How much should Laura include in her 2019 taxable income as alimony? a.$10,000 b.$4,000 c.$0 d.$6,000 e.None of these choices are correct.

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Answer #1

Answer -

Step - (1) - Relevant Information Given :-

Laura and Leon were granted a divorce in 2019. Annual cash payments, other than child support, specified as alimony in the divorce agreement $6000.

.

Step - (2) - Analysis and Conclusion :-

As per U.S Internal Revenue Service, if divorce is finalized in 2019 or after, then the alimony payments are no longer deductible, nor does the recipient have to report them as income.

In the given case, Laura is not required to report the $6000 alimony received as income and Leon cannot claim alimony paid as an adjustment to income.

Therefore, Laura's 2019 taxable income as alimony is zero.

Hence, Option - (c) is Correct.

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