Trump tax rule change has some rushing to divorce before 2019
Susan Tompor, Detroit Free Press
Published 7:00 a.m. ET Dec. 19, 2018
Some angry but bottom-line-driven couples are hoping to celebrate the New Year by making sure they finalize that divorce by Dec. 31.
The reason? Beginning in 2019, President Donald Trump's tax overhaul will eliminate one lucrative tax break relating to alimony.
snip
About 27 percent of CPA financial planners said they have seen an increase in the number of clients seeking to finalize their divorce before 2019, with 6 percent citing a substantial increase, according to the American Institute of CPAs 2018 Personal Financial Planning Trends Survey.
The ex-spouse who pays alimony will no longer be able to deduct that expense unless the divorce settlement takes place before Dec. 31. It's a big deal if you're paying $30,000 a year or far more in spousal support and you're in a higher tax bracket.
Alimony was treated as a highly favorable, above-the-line tax deduction that reduced your taxable income even before your adjusted gross income was calculated. You can take above-the-line deductions, even if you don't itemize.
snip
Consider this simplified example: Assume the taxpayer earns $100,000 and pays $20,000 in alimony.
In this example, the ex-spouse paying alimony could end up handing over $4,472 more in federal taxes if the divorce isn't settled until 2019, Charney said. That's because the $20,000 paid in alimony would not longer be deductible and would be treated as taxable income.
snip
https://www.freep.com/story/money/personal-finance/susan-tompor/2018/12/19/divorce-alimony-income-tax-deduction/2310068002/
-------------------------------------------
There are going to be a lot of pissed off people in 2019. MAGA, indeed.