It is common for a final divorce decree to contain stipulations requirin g one of the parties to pay some form of financial support to the other party. In a previous post on this blog, we covered the subject of alimony and its purpose. In this post, we will briefly discuss what documentation a payer of alimony should keep for his or her personal records.
If you are paying alimony, understand that the payments are typically tax deductible. For this reason, it is highly advisable to keep careful records of the payments that are made. If the IRS conducts an audit on your returns and you don't have records to prove your payments, you could lose your tax deductions for those payments.
These records can also come in very handy if the receiver of the alimony challenges the amounts that you have been paying. Without documentation, you may be forced to pay even more.
So, here are some of the important documents it would be helpful to keep on file:
- Receipts signed by the payee for all cash payments made. Make sure the receipt indicates the month the payment was issued.
- Carbon copies of the alimony checks you write. Notate in the memo section of the check that it was for alimony.
- Cashed alimony checks along with a list itemizing the amounts and dates of the payments made.
If you have to pay alimony, you should get credit for having done so. Your records can stand as proof that you paid as required. But sometimes in spite of your best efforts, a dispute over the payments may still arise. If your ex-spouse chooses to accuse you of having not made the full amount of payments due, a Texas divorce attorney may be able to act on your behalf in court.