Alimony, or "spousal support," is payment made from one spouse to the other to balance out the economic disparity between the two. Spousal support, although it is less common today than in previous years, is usually ordered following a formalized divorce or separation. The point of alimony is to ensure that the dependent spouse is not rendered penniless due to a divorce. It allows a spouse that forewent professional or educational development for the benefit of the marriage or children. This post covers the various records you should keep of spousal support payments and receipts.
You will only need these articles if you get into a dispute with your ex-spouse regarding payments or your finances are audited. Alimony payments have a unique tax treatment which means that you must keep detailed records to prove your income levels and payments. If you are receiving spousal support, then you should keep records detailing:
- The amount given.
- The date payment was sent.
- A copy of the payment.
- The name of the paying bank and the identifying number of the transaction, which is typically a check number or unique identifier number for e-transfers.
- The account number from which payment was sent.
- A copy of the signed receipt acknowledging that your ex-spouse accepted it.
These documents can be given to the IRS to establish that you properly claimed alimony payments on your taxes. It is unlikely that you will ever need these documents, but it is safer to keep them and not need them than to need them and not have them.
If you recently went through a divorce and you are paying spousal support, then you may want to speak to a lawyer. A lawyer can help clarify your legal rights and risks regarding the alimony payments and how best to approach keeping records. Additionally, should a dispute ever arise over the payments themselves, these records will make it possible to easily establish your financial position.