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Free online tax filing 5. Free online tax filing   Table and Worksheets for the Self-Employed Table of Contents Community property laws. Free online tax filing As discussed in chapters 2 and 4, if you are self-employed, you must use the rate table or rate worksheet and deduction worksheet to figure your deduction for contributions you made for yourself to a SEP-IRA or qualified plan. Free online tax filing First, use either the rate table or rate worksheet to find your reduced contribution rate. Free online tax filing Then complete the deduction worksheet to figure your deduction for contributions. Free online tax filing The table and the worksheets in chapter 5 apply only to self-employed individuals who have only one defined contribution plan, such as a profit-sharing plan. Free online tax filing A SEP plan is treated as a profit-sharing plan. Free online tax filing However, do not use this worksheet for SARSEPs. Free online tax filing Rate table for self-employed. Free online tax filing   If your plan's contribution rate is a whole percentage (for example, 12% rather than 12½%), you can use the table on the next page to find your reduced contribution rate. Free online tax filing Otherwise, use the rate worksheet provided below. Free online tax filing   First, find your plan contribution rate (the contribution rate stated in your plan) in Column A of the table. Free online tax filing Then read across to the rate under Column B. Free online tax filing Enter the rate from Column B in step 4 of the Deduction Worksheet for Self-Employed on this page. Free online tax filing    Example. Free online tax filing You are a sole proprietor with no employees. Free online tax filing If your plan's contribution rate is 10% of a participant's compensation, your rate is 0. Free online tax filing 090909. Free online tax filing Enter this rate in step 4 of the Deduction Worksheet for Self-Employed on this page. Free online tax filing Deduction Worksheet for Self-Employed   Step 1           Enter your net profit from line 31, Schedule C (Form 1040); line 3, Schedule C-EZ (Form 1040); line 34, Schedule F (Form 1040)*; or box 14, code A**, Schedule K-1 (Form 1065)*. Free online tax filing For information on other income included in net profit from self-employment, see the Instructions for Schedule SE, Form 1040. Free online tax filing       *Reduce this amount by any amount reported on Schedule SE (Form 1040), line 1b. Free online tax filing       **General partners should reduce this amount by the same additional expenses subtracted from box 14, code A to determine the amount on line 1 or 2 of Schedule SE. Free online tax filing     Step 2           Enter your deduction for self-employment tax from Form 1040, line 27             Step 3           Net earnings from self-employment. Free online tax filing Subtract step 2 from step 1     Step 4           Enter your rate from the Rate Table for Self-Employed or Rate Worksheet for Self-Employed     Step 5           Multiply step 3 by step 4     Step 6           Multiply $255,000 by your plan contribution rate (not the reduced rate)     Step 7           Enter the smaller of step 5 or step 6     Step 8           Contribution dollar limit $51,000     • If you made any elective deferrals to your self-employed plan, go to step 9. Free online tax filing         • Otherwise, skip steps 9 through 20 and enter the smaller of step 7 or step 8 on step 21. Free online tax filing       Step 9           Enter your allowable elective deferrals (including designated Roth contributions) made to your self-employed plan during 2013. Free online tax filing Do not enter more than $17,500     Step 10           Subtract step 9 from step 8     Step 11           Subtract step 9 from step 3       Step 12           Enter one-half of step 11     Step 13           Enter the smallest of step 7, 10, or 12     Step 14           Subtract step 13 from step 3     Step 15           Enter the smaller of step 9 or step 14       • If you made catch-up contributions, go to step 16. Free online tax filing         • Otherwise, skip steps 16 through 18 and go to step 19. Free online tax filing       Step 16           Subtract step 15 from step 14     Step 17           Enter your catch-up contributions (including designated Roth contributions), if any. Free online tax filing Do not enter more than $5,500     Step 18           Enter the smaller of step 16 or step 17     Step 19           Add steps 13, 15, and 18. Free online tax filing     Step 20           Enter the amount of designated Roth contributions included on lines 9 and 17. Free online tax filing     Step 21           Subtract step 20 from step 19. Free online tax filing This is your maximum deductible contribution. Free online tax filing                 Next: Enter your actual contribution, not to exceed your maximum deductible contribution, on Form 1040, line 28. Free online tax filing   Rate worksheet for self-employed. Free online tax filing   If your plan's contribution rate is not a whole percentage (for example, 10½%), you cannot use the Rate Table for Self-Employed. Free online tax filing Use the following worksheet instead. Free online tax filing Rate Worksheet for Self-Employed 1) Plan contribution rate as a decimal (for example, 10½% = 0. Free online tax filing 105)   2) Rate in line 1 plus 1 (for example, 0. Free online tax filing 105 + 1 = 1. Free online tax filing 105)   3) Self-employed rate as a decimal rounded to at least 3 decimal places (line 1 ÷ line 2) (for example, 0. Free online tax filing 105 ÷ 1. Free online tax filing 105 = 0. Free online tax filing 095)   Figuring your deduction. Free online tax filing   Now that you have your self-employed rate from either the rate table or rate worksheet, you can figure your maximum deduction for contributions for yourself by completing the Deduction Worksheet for Self-Employed. Free online tax filing Community property laws. Free online tax filing   If you reside in a community property state and you are married and filing a separate return, disregard community property laws for step 1 of the Deduction Worksheet for Self-Employed. Free online tax filing Enter on step 1 the total net profit you actually earned. Free online tax filing Rate Table for Self-Employed Column A  If the plan contri- bution rate is: (shown as %) Column B  Your rate is: (shown as decimal) 1 . Free online tax filing 009901 2 . Free online tax filing 019608 3 . Free online tax filing 029126 4 . Free online tax filing 038462 5 . Free online tax filing 047619 6 . Free online tax filing 056604 7 . Free online tax filing 065421 8 . Free online tax filing 074074 9 . Free online tax filing 082569 10 . Free online tax filing 090909 11 . Free online tax filing 099099 12 . Free online tax filing 107143 13 . Free online tax filing 115044 14 . Free online tax filing 122807 15 . Free online tax filing 130435 16 . Free online tax filing 137931 17 . Free online tax filing 145299 18 . Free online tax filing 152542 19 . Free online tax filing 159664 20 . Free online tax filing 166667 21 . Free online tax filing 173554 22 . Free online tax filing 180328 23 . Free online tax filing 186992 24 . Free online tax filing 193548 25* . Free online tax filing 200000* *The deduction for annual employer contributions (other than elective deferrals) to a SEP plan, a profit-sharing plan, or a money purchase plan cannot be more than 20% of your net earnings (figured without deducting contributions for yourself) from the business that has the plan. Free online tax filing Example. Free online tax filing You are a sole proprietor with no employees. Free online tax filing The terms of your plan provide that you contribute 8½% (. Free online tax filing 085) of your compensation to your plan. Free online tax filing Your net profit from line 31, Schedule C (Form 1040) is $200,000. Free online tax filing You have no elective deferrals or catch-up contributions. Free online tax filing Your self-employment tax deduction on line 27 of Form 1040 is $9,728. Free online tax filing See the filled-in portions of both Schedule SE (Form 1040), Self-Employment Income, and Form 1040, later. Free online tax filing You figure your self-employed rate and maximum deduction for employer contributions you made for yourself as follows. Free online tax filing Deduction Worksheet for Self-Employed   Step 1           Enter your net profit from line 31, Schedule C (Form 1040); line 3, Schedule C-EZ (Form 1040); line 34, Schedule F (Form 1040)*; or box 14, code A**, Schedule K-1 (Form 1065)*. Free online tax filing For information on other income included in net profit from self-employment, see the Instructions for Schedule SE, Form 1040. Free online tax filing $200,000     *Reduce this amount by any amount reported on Schedule SE (Form 1040), line 1b. Free online tax filing       **General partners should reduce this amount by the same additional expenses subtracted from box 14, code A to determine the amount on line 1 or 2 of Schedule SE. Free online tax filing     Step 2           Enter your deduction for self-employment tax from Form 1040, line 27 9,728           Step 3           Net earnings from self-employment. Free online tax filing Subtract step 2 from step 1 190,272   Step 4           Enter your rate from the Rate Table for Self-Employed or Rate Worksheet for Self-Employed 0. Free online tax filing 078   Step 5           Multiply step 3 by step 4 14,841   Step 6           Multiply $255,000 by your plan contribution rate (not the reduced rate) 21,675   Step 7           Enter the smaller of step 5 or step 6 14,841   Step 8           Contribution dollar limit $51,000     • If you made any elective deferrals to your self-employed plan, go to step 9. Free online tax filing         • Otherwise, skip steps 9 through 20 and enter the smaller of step 7 or step 8 on step 21. Free online tax filing       Step 9           Enter your allowable elective deferrals (including designated Roth contributions) made to your self-employed plan during 2013. Free online tax filing Do not enter more than $17,500 N/A   Step 10           Subtract step 9 from step 8     Step 11           Subtract step 9 from step 3       Step 12           Enter one-half of step 11     Step 13           Enter the smallest of step 7, 10, or 12     Step 14           Subtract step 13 from step 3     Step 15           Enter the smaller of step 9 or step 14       • If you made catch-up contributions, go to step 16. Free online tax filing         • Otherwise, skip steps 16 through 18 and go to step 19. Free online tax filing       Step 16           Subtract step 15 from step 14     Step 17           Enter your catch-up contributions (including designated Roth contributions), if any. Free online tax filing Do not enter more than $5,500     Step 18           Enter the smaller of step 16 or step 17     Step 19           Add steps 13, 15, and 18. Free online tax filing     Step 20           Enter the amount of designated Roth contributions included on lines 9 and 17     Step 21           Subtract step 20 from step 19. Free online tax filing This is your maximum deductible contribution $14,841                 Next: Enter your actual contribution, not to exceed your maximum deductible contribution, on Form 1040, line 28. Free online tax filing   See the filled-in Deduction Worksheet for Self-Employed on this page. Free online tax filing Rate Worksheet for Self-Employed 1) Plan contribution rate as a decimal (for example, 10½% = 0. Free online tax filing 105) 0. Free online tax filing 085 2) Rate in line 1 plus 1 (for example, 0. Free online tax filing 105 + 1 = 1. Free online tax filing 105) 1. Free online tax filing 085 3) Self-employed rate as a decimal rounded to at least 3 decimal places (line 1 ÷ line 2) (for example, 0. Free online tax filing 105 ÷ 1. Free online tax filing 105 = 0. Free online tax filing 095) 0. Free online tax filing 078 This image is too large to be displayed in the current screen. Free online tax filing Please click the link to view the image. Free online tax filing Portion of Form 1040 and Portion of Schedule SE Prev  Up  Next   Home   More Online Publications
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The Free Online Tax Filing

Free online tax filing 18. Free online tax filing   Alimony Table of Contents IntroductionSpouse or former spouse. Free online tax filing Divorce or separation instrument. Free online tax filing Useful Items - You may want to see: General RulesMortgage payments. Free online tax filing Taxes and insurance. Free online tax filing Other payments to a third party. Free online tax filing Instruments Executed After 1984Payments to a third party. Free online tax filing Exception. Free online tax filing Substitute payments. Free online tax filing Specifically designated as child support. Free online tax filing Contingency relating to your child. Free online tax filing Clearly associated with a contingency. Free online tax filing How To Deduct Alimony Paid How To Report Alimony Received Recapture Rule Introduction This chapter discusses the rules that apply if you pay or receive alimony. Free online tax filing It covers the following topics. Free online tax filing What payments are alimony. Free online tax filing What payments are not alimony, such as child support. Free online tax filing How to deduct alimony you paid. Free online tax filing How to report alimony you received as income. Free online tax filing Whether you must recapture the tax benefits of alimony. Free online tax filing Recapture means adding back in your income all or part of a deduction you took in a prior year. Free online tax filing Alimony is a payment to or for a spouse or former spouse under a divorce or separation instrument. Free online tax filing It does not include voluntary payments that are not made under a divorce or separation instrument. Free online tax filing Alimony is deductible by the payer and must be included in the spouse's or former spouse's income. Free online tax filing Although this chapter is generally written for the payer of the alimony, the recipient can use the information to determine whether an amount received is alimony. Free online tax filing To be alimony, a payment must meet certain requirements. Free online tax filing Different requirements generally apply to payments under instruments executed after 1984 and to payments under instruments executed before 1985. Free online tax filing This chapter discusses the rules for payments under instruments executed after 1984. Free online tax filing If you need the rules for payments under pre-1985 instruments, get and keep a copy of the 2004 version of Publication 504. Free online tax filing That was the last year the information on pre-1985 instruments was included in Publication 504. Free online tax filing Use Table 18-1 in this chapter as a guide to determine whether certain payments are considered alimony. Free online tax filing Definitions. Free online tax filing   The following definitions apply throughout this chapter. Free online tax filing Spouse or former spouse. Free online tax filing   Unless otherwise stated, the term “spouse” includes former spouse. Free online tax filing Divorce or separation instrument. Free online tax filing   The term “divorce or separation instrument” means: A decree of divorce or separate maintenance or a written instrument incident to that decree, A written separation agreement, or A decree or any type of court order requiring a spouse to make payments for the support or maintenance of the other spouse. Free online tax filing This includes a temporary decree, an interlocutory (not final) decree, and a decree of alimony pendente lite (while awaiting action on the final decree or agreement). Free online tax filing Useful Items - You may want to see: Publication 504 Divorced or Separated Individuals General Rules The following rules apply to alimony regardless of when the divorce or separation instrument was executed. Free online tax filing Payments not alimony. Free online tax filing   Not all payments under a divorce or separation instrument are alimony. Free online tax filing Alimony does not include: Child support, Noncash property settlements, Payments that are your spouse's part of community income, as explained under Community Property in Publication 504, Payments to keep up the payer's property, or Use of the payer's property. Free online tax filing Payments to a third party. Free online tax filing   Cash payments, checks, or money orders to a third party on behalf of your spouse under the terms of your divorce or separation instrument can be alimony, if they otherwise qualify. Free online tax filing These include payments for your spouse's medical expenses, housing costs (rent, utilities, etc. Free online tax filing ), taxes, tuition, etc. Free online tax filing The payments are treated as received by your spouse and then paid to the third party. Free online tax filing Life insurance premiums. Free online tax filing   Alimony includes premiums you must pay under your divorce or separation instrument for insurance on your life to the extent your spouse owns the policy. Free online tax filing Payments for jointly-owned home. Free online tax filing   If your divorce or separation instrument states that you must pay expenses for a home owned by you and your spouse, some of your payments may be alimony. Free online tax filing Mortgage payments. Free online tax filing   If you must pay all the mortgage payments (principal and interest) on a jointly-owned home, and they otherwise qualify as alimony, you can deduct one-half of the total payments as alimony. Free online tax filing If you itemize deductions and the home is a qualified home, you can claim one-half of the interest in figuring your deductible interest. Free online tax filing Your spouse must report one-half of the payments as alimony received. Free online tax filing If your spouse itemizes deductions and the home is a qualified home, he or she can claim one-half of the interest on the mortgage in figuring deductible interest. Free online tax filing Taxes and insurance. Free online tax filing   If you must pay all the real estate taxes or insurance on a home held as tenants in common, you can deduct one-half of these payments as alimony. Free online tax filing Your spouse must report one-half of these payments as alimony received. Free online tax filing If you and your spouse itemize deductions, you can each claim one-half of the real estate taxes and none of the home insurance. Free online tax filing    If your home is held as tenants by the entirety or joint tenants, none of your payments for taxes or insurance are alimony. Free online tax filing But if you itemize deductions, you can claim all of the real estate taxes and none of the home insurance. Free online tax filing Other payments to a third party. Free online tax filing   If you made other third-party payments, see Publication 504 to see whether any part of the payments qualifies as alimony. Free online tax filing Instruments Executed After 1984 The following rules for alimony apply to payments under divorce or separation instruments executed after 1984. Free online tax filing Exception for instruments executed before 1985. Free online tax filing   There are two situations where the rules for instruments executed after 1984 apply to instruments executed before 1985. Free online tax filing A divorce or separation instrument executed before 1985 and then modified after 1984 to specify that the after-1984 rules will apply. Free online tax filing A temporary divorce or separation instrument executed before 1985 and incorporated into, or adopted by, a final decree executed after 1984 that: Changes the amount or period of payment, or Adds or deletes any contingency or condition. Free online tax filing   For the rules for alimony payments under pre-1985 instruments not meeting these exceptions, get the 2004 version of Publication 504 at www. Free online tax filing irs. Free online tax filing gov/pub504. Free online tax filing Example 1. Free online tax filing In November 1984, you and your former spouse executed a written separation agreement. Free online tax filing In February 1985, a decree of divorce was substituted for the written separation agreement. Free online tax filing The decree of divorce did not change the terms for the alimony you pay your former spouse. Free online tax filing The decree of divorce is treated as executed before 1985. Free online tax filing Alimony payments under this decree are not subject to the rules for payments under instruments executed after 1984. Free online tax filing Example 2. Free online tax filing Assume the same facts as in Example 1 except that the decree of divorce changed the amount of the alimony. Free online tax filing In this example, the decree of divorce is not treated as executed before 1985. Free online tax filing The alimony payments are subject to the rules for payments under instruments executed after 1984. Free online tax filing Alimony requirements. Free online tax filing   A payment to or for a spouse under a divorce or separation instrument is alimony if the spouses do not file a joint return with each other and all the following requirements are met. Free online tax filing The payment is in cash. Free online tax filing The instrument does not designate the payment as not alimony. Free online tax filing Spouses legally separated under a decree of divorce or separate maintenance are not members of the same household. Free online tax filing There is no liability to make any payment (in cash or property) after the death of the recipient spouse. Free online tax filing The payment is not treated as child support. Free online tax filing Each of these requirements is discussed below. Free online tax filing Cash payment requirement. Free online tax filing   Only cash payments, including checks and money orders, qualify as alimony. Free online tax filing The following do not qualify as alimony. Free online tax filing Transfers of services or property (including a debt instrument of a third party or an annuity contract). Free online tax filing Execution of a debt instrument by the payer. Free online tax filing The use of the payer's property. Free online tax filing Payments to a third party. Free online tax filing   Cash payments to a third party under the terms of your divorce or separation instrument can qualify as cash payments to your spouse. Free online tax filing See Payments to a third party under General Rules, earlier. Free online tax filing   Also, cash payments made to a third party at the written request of your spouse may qualify as alimony if all the following requirements are met. Free online tax filing The payments are in lieu of payments of alimony directly to your spouse. Free online tax filing The written request states that both spouses intend the payments to be treated as alimony. Free online tax filing You receive the written request from your spouse before you file your return for the year you made the payments. Free online tax filing Payments designated as not alimony. Free online tax filing   You and your spouse can designate that otherwise qualifying payments are not alimony. Free online tax filing You do this by including a provision in your divorce or separation instrument that states the payments are not deductible as alimony by you and are excludable from your spouse's income. Free online tax filing For this purpose, any instrument (written statement) signed by both of you that makes this designation and that refers to a previous written separation agreement is treated as a written separation agreement (and therefore a divorce or separation instrument). Free online tax filing If you are subject to temporary support orders, the designation must be made in the original or a later temporary support order. Free online tax filing   Your spouse can exclude the payments from income only if he or she attaches a copy of the instrument designating them as not alimony to his or her return. Free online tax filing The copy must be attached each year the designation applies. Free online tax filing Spouses cannot be members of the same household. Free online tax filing    Payments to your spouse while you are members of the same household are not alimony if you are legally separated under a decree of divorce or separate maintenance. Free online tax filing A home you formerly shared is considered one household, even if you physically separate yourselves in the home. Free online tax filing   You are not treated as members of the same household if one of you is preparing to leave the household and does leave no later than 1 month after the date of the payment. Free online tax filing Exception. Free online tax filing   If you are not legally separated under a decree of divorce or separate maintenance, a payment under a written separation agreement, support decree, or other court order may qualify as alimony even if you are members of the same household when the payment is made. Free online tax filing Table 18-1. Free online tax filing Alimony Requirements (Instruments Executed After 1984) Payments ARE alimony if all of the following are true: Payments are NOT alimony if any of the following are true: Payments are required by a divorce or separation instrument. Free online tax filing Payments are not required by a divorce or separation instrument. Free online tax filing Payer and recipient spouse do not file a joint return with each other. Free online tax filing Payer and recipient spouse file a joint return with each other. Free online tax filing Payment is in cash (including checks or money orders). Free online tax filing Payment is: Not in cash, A noncash property settlement, Spouse's part of community income, or To keep up the payer's property. Free online tax filing Payment is not designated in the instrument as not alimony. Free online tax filing Payment is designated in the instrument as not alimony. Free online tax filing Spouses legally separated under a decree of divorce or separate maintenance are not members of the same household. Free online tax filing Spouses legally separated under a decree of divorce or separate maintenance are members of the same household. Free online tax filing Payments are not required after death of the recipient spouse. Free online tax filing Payments are required after death of the recipient spouse. Free online tax filing Payment is not treated as child support. Free online tax filing Payment is treated as child support. Free online tax filing These payments are deductible by the payer and includible in income by the recipient. Free online tax filing These payments are neither deductible by the payer nor includible in income by the recipient. Free online tax filing Liability for payments after death of recipient spouse. Free online tax filing   If any part of payments you make must continue to be made for any period after your spouse's death, that part of your payments is not alimony, whether made before or after the death. Free online tax filing If all of the payments would continue, then none of the payments made before or after the death are alimony. Free online tax filing   The divorce or separation instrument does not have to expressly state that the payments cease upon the death of your spouse if, for example, the liability for continued payments would end under state law. Free online tax filing Example. Free online tax filing You must pay your former spouse $10,000 in cash each year for 10 years. Free online tax filing Your divorce decree states that the payments will end upon your former spouse's death. Free online tax filing You must also pay your former spouse or your former spouse's estate $20,000 in cash each year for 10 years. Free online tax filing The death of your spouse would not terminate these payments under state law. Free online tax filing The $10,000 annual payments may qualify as alimony. Free online tax filing The $20,000 annual payments that do not end upon your former spouse's death are not alimony. Free online tax filing Substitute payments. Free online tax filing   If you must make any payments in cash or property after your spouse's death as a substitute for continuing otherwise qualifying payments before the death, the otherwise qualifying payments are not alimony. Free online tax filing To the extent that your payments begin, accelerate, or increase because of the death of your spouse, otherwise qualifying payments you made may be treated as payments that were not alimony. Free online tax filing Whether or not such payments will be treated as not alimony depends on all the facts and circumstances. Free online tax filing Example 1. Free online tax filing Under your divorce decree, you must pay your former spouse $30,000 annually. Free online tax filing The payments will stop at the end of 6 years or upon your former spouse's death, if earlier. Free online tax filing Your former spouse has custody of your minor children. Free online tax filing The decree provides that if any child is still a minor at your spouse's death, you must pay $10,000 annually to a trust until the youngest child reaches the age of majority. Free online tax filing The trust income and corpus (principal) are to be used for your children's benefit. Free online tax filing These facts indicate that the payments to be made after your former spouse's death are a substitute for $10,000 of the $30,000 annual payments. Free online tax filing Of each of the $30,000 annual payments, $10,000 is not alimony. Free online tax filing Example 2. Free online tax filing Under your divorce decree, you must pay your former spouse $30,000 annually. Free online tax filing The payments will stop at the end of 15 years or upon your former spouse's death, if earlier. Free online tax filing The decree provides that if your former spouse dies before the end of the 15-year period, you must pay the estate the difference between $450,000 ($30,000 × 15) and the total amount paid up to that time. Free online tax filing For example, if your spouse dies at the end of the tenth year, you must pay the estate $150,000 ($450,000 − $300,000). Free online tax filing These facts indicate that the lump-sum payment to be made after your former spouse's death is a substitute for the full amount of the $30,000 annual payments. Free online tax filing None of the annual payments are alimony. Free online tax filing The result would be the same if the payment required at death were to be discounted by an appropriate interest factor to account for the prepayment. Free online tax filing Child support. Free online tax filing   A payment that is specifically designated as child support or treated as specifically designated as child support under your divorce or separation instrument is not alimony. Free online tax filing The amount of child support may vary over time. Free online tax filing Child support payments are not deductible by the payer and are not taxable to the recipient. Free online tax filing Specifically designated as child support. Free online tax filing   A payment will be treated as specifically designated as child support to the extent that the payment is reduced either: On the happening of a contingency relating to your child, or At a time that can be clearly associated with the contingency. Free online tax filing A payment may be treated as specifically designated as child support even if other separate payments are specifically designated as child support. Free online tax filing Contingency relating to your child. Free online tax filing   A contingency relates to your child if it depends on any event relating to that child. Free online tax filing It does not matter whether the event is certain or likely to occur. Free online tax filing Events relating to your child include the child's: Becoming employed, Dying, Leaving the household, Leaving school, Marrying, or Reaching a specified age or income level. Free online tax filing Clearly associated with a contingency. Free online tax filing   Payments that would otherwise qualify as alimony are presumed to be reduced at a time clearly associated with the happening of a contingency relating to your child only in the following situations. Free online tax filing The payments are to be reduced not more than 6 months before or after the date the child will reach 18, 21, or local age of majority. Free online tax filing The payments are to be reduced on two or more occasions that occur not more than 1 year before or after a different one of your children reaches a certain age from 18 to 24. Free online tax filing This certain age must be the same for each child, but need not be a whole number of years. Free online tax filing In all other situations, reductions in payments are not treated as clearly associated with the happening of a contingency relating to your child. Free online tax filing   Either you or the IRS can overcome the presumption in the two situations above. Free online tax filing This is done by showing that the time at which the payments are to be reduced was determined independently of any contingencies relating to your children. Free online tax filing For example, if you can show that the period of alimony payments is customary in the local jurisdiction, such as a period equal to one-half of the duration of the marriage, you can overcome the presumption and may be able to treat the amount as alimony. Free online tax filing How To Deduct Alimony Paid You can deduct alimony you paid, whether or not you itemize deductions on your return. Free online tax filing You must file Form 1040. Free online tax filing You cannot use Form 1040A or Form 1040EZ. Free online tax filing Enter the amount of alimony you paid on Form 1040, line 31a. Free online tax filing In the space provided on line 31b, enter your spouse's social security number (SSN) or individual taxpayer identification number (ITIN). Free online tax filing If you paid alimony to more than one person, enter the SSN or ITIN of one of the recipients. Free online tax filing Show the SSN or ITIN and amount paid to each other recipient on an attached statement. Free online tax filing Enter your total payments on line 31a. Free online tax filing You must provide your spouse's SSN or ITIN. Free online tax filing If you do not, you may have to pay a $50 penalty and your deduction may be disallowed. Free online tax filing For more information on SSNs and ITINs, see Social Security Number (SSN) in chapter 1. Free online tax filing How To Report Alimony Received Report alimony you received as income on Form 1040, line 11. Free online tax filing You cannot use Form 1040A or Form 1040EZ. Free online tax filing You must give the person who paid the alimony your SSN or ITIN. Free online tax filing If you do not, you may have to pay a $50 penalty. Free online tax filing Recapture Rule If your alimony payments decrease or end during the first 3 calendar years, you may be subject to the recapture rule. Free online tax filing If you are subject to this rule, you have to include in income in the third year part of the alimony payments you previously deducted. Free online tax filing Your spouse can deduct in the third year part of the alimony payments he or she previously included in income. Free online tax filing The 3-year period starts with the first calendar year you make a payment qualifying as alimony under a decree of divorce or separate maintenance or a written separation agreement. Free online tax filing Do not include any time in which payments were being made under temporary support orders. Free online tax filing The second and third years are the next 2 calendar years, whether or not payments are made during those years. Free online tax filing The reasons for a reduction or end of alimony payments that can require a recapture include: A change in your divorce or separation instrument, A failure to make timely payments, A reduction in your ability to provide support, or A reduction in your spouse's support needs. Free online tax filing When to apply the recapture rule. Free online tax filing   You are subject to the recapture rule in the third year if the alimony you pay in the third year decreases by more than $15,000 from the second year or the alimony you pay in the second and third years decreases significantly from the alimony you pay in the first year. Free online tax filing   When you figure a decrease in alimony, do not include the following amounts. Free online tax filing Payments made under a temporary support order. Free online tax filing Payments required over a period of at least 3 calendar years that vary because they are a fixed part of your income from a business or property, or from compensation for employment or self-employment. Free online tax filing Payments that decrease because of the death of either spouse or the remarriage of the spouse receiving the payments before the end of the third year. Free online tax filing Figuring the recapture. Free online tax filing   You can use Worksheet 1 in Publication 504 to figure recaptured alimony. Free online tax filing Including the recapture in income. Free online tax filing   If you must include a recapture amount in income, show it on Form 1040, line 11 (“Alimony received”). Free online tax filing Cross out “received” and enter “recapture. Free online tax filing ” On the dotted line next to the amount, enter your spouse's last name and SSN or ITIN. Free online tax filing Deducting the recapture. Free online tax filing   If you can deduct a recapture amount, show it on Form 1040, line 31a (“Alimony paid”). Free online tax filing Cross out “paid” and enter “recapture. Free online tax filing ” In the space provided, enter your spouse's SSN or ITIN. Free online tax filing Prev  Up  Next   Home   More Online Publications