Under current IRS law, spousal maintenance and alimony are deductible by the paying party and must be reported as income by the receiving party.  This arrangement is advantageous to couples going through a divorce and planning to include spousal maintenance or alimony in their property settlement because the higher earning spouse is paying taxes at a higher rate than the receiving spouse.  The higher earning spouse may deduct the spousal maintenance or alimony payments on form 1040 at a high tax … [Read more...]