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New 2017 Tax Laws Eliminating Maintenance payment deduction?

Posted by Christopher Holwell | Dec 11, 2017 | 0 Comments

The 2017 Tax Reform Bill has passed both houses of Congress.

How will this affect those of us who currently pay Maintenance/Alimony in Illinois?

While both houses of Congress passed their respective bills, both houses now need to work out the substantial differences between the two. If you want to take the time to read the latest passed version head over to https://www.congress.gov/bill/115th-congress/senate-bill/18/all-info.

  1. As it is now, Maintenance paid now to a former spouse is taxable for the recipient. So that both parties are not taxed on the same income, the one who makes the payments is allow to deduct the amount paid.
  2. The new tax law potentially could eliminate this deduction and have a significant impact on taxpayers who pay their former spouse.
  3. It appears that the new tax law creates a “divorce tax”. Depending on your income, you could be “pushed” into a higher tax bracket.
  4. Since there will be less money (and more paid to Uncle Sam), its possible the amount and duration of maintenance will have to be reconsider.

We wont know what the final version will bring until we see it. What used to be a more equitable system seems to have be pushed aside for political progress.

About the Author

Christopher Holwell

Christopher W. Holwell Attorney/Principal 6 years with Holwell Group, LLC/Law Offices of Christopher W. Holwell 15 years as a trial attorney for Divorce, Real Estate, Insurance Coverage, and Injury. One of my biggest accomplishments in a divorce case was getting a multi-million dollar settlement from a spouse that was not disclosing several million dollars in assets. In addition, I was able to get the other spouse to fully fund the one child's college education as part of the settlement. Another of my biggest accomplishments in an injury case was procuring a several hundred thousand dollar settlement for my 14-year-old client who suffered a knee injury during an after school athletic program. I was able to get all interested parties to set aside funds for the client's college fund in case his athletic scholarship was affected. I am constantly attending Continuing Legal Education seminars to stay up to date on any changes in the law that might affect any of my clients. My primary areas of practice are Divorce, Family Law, Real Estate, and Insurance Litigation. Most of my clients are concerned with what to do or what not to do when the first come to see me for a consultation or appointment. Their next concern is usually financial; what are they going to do now? How are they going to survive? I tell each client, based on their unique situation, what their options are and what will happen next. I am there for them from start to finish. The best part of my job is doing the work the client is too upset to do. While I understand the emotional roller-coaster clients go through, my experience allows me to step outside the emotion point of view, and use the law and facts to benefit my clients to the best of my ability. I was born in Oak Lawn, Illinois, was raised in Bridgeview up until college and now live in Lake County, Illinois with my family (my wife and three children.) I still have family in Bridgeview, Oak Lawn, and Orland Park. A little-known fact about me is that I love astronomy and anything to do with the stars and planets. In my free time, I tend to read a lot, usually late at night and play with my children and new Newfoundland puppy, Indy (Indiana Jones) I am admitted to practice law in Illinois and all Federal Courts including the Supreme Court of the Untied States of America. I treat my clients like friends. You can reach me at: (312) 648-6115 [email protected] [email protected] Linkedin: Christopher W. Holwell Facebook: Holwell Law Group, LLC

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