The Tax Cut and Jobs Act of 2017 has made a big and significant change to alimony and maintenance. Beforehand, alimony and maintenance were deductible for payers on their federal return and were reported as income by the receiver. In most cases, the payer is in a higher bracket so they were able to deduct at a high rate than the receiver would report. This was an effective way to create money in a divorce since the federal government was subsidizing alimony and maintenance payments by their favorable tax treatment.

This is no more. Effective for divorces finalized after December 31, 2018 alimony and maintenance will not be deductible. For a decree entered before then, or already in effect, the old tax law allowing deductibility will be grandfathered.