The new tax plan will make the divorce even worse

The new tax plan will make the divorce even worse

In the depths of the new bill relating to taxes (which occupies 429 pages), the Republicans have had a curious paragraph, which provides for severe financial consequences for those who decided to terminate their marriage. From now on, alimony will be taxed, and to pay them will be the same spouse who writes them a check.

At the moment the tax deductions in the payment of child support does the person who receives them. But with the passage of the bill, everything will change. The rule will take effect for all divorces, committed since the beginning of the New year.

The new tax plan will make the divorce even worse

The creators of the law believe that such a step will provide a greater amount of tax revenuethat the state receives due to the divorce, since alimony usually pays the ex-spouse with the higher income. According to forecasts, the change should bring the Treasury an additional 8.3 billion dollars over the next 10 years.

Thus, the tax plan will encourage families to overcome difficulties and save the marriage. The magazine Business Insider illustrates this as an example of a hypothetical family of bill and Alice Smith. Bill earns $80,000 a year as an engineer, and his wife, artist Alice – only $20,000. In the case of divorce, bill will pay $10,850 tax year and a further $15,000 of alimony that is to Alice, which you need to pay only $660 with their income. Therefore, the joint tax already former spouses will be $11,510, which is 35% morethan their total tax as a married couple.

In other words, the new tax plan could reduce the number of divorces, which is good. But on the other hand, the bill can turn an unhappy marriage into financial bondage for those who can’t afford the payment of «fines for divorce.»

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