Alimony That Does Not Look Like Alimony
The lesson I would take away is that people who are expecting payments to not be taxable as alimony should probably insist on an explicit statement in the agreement to avoid being blindsided.
Graduation Contingency Kills Alimony Deduction
In this case, the divorce decree clearly states that the support payments will terminate upon the graduation of the youngest child. With this kind of contingency, the statute compels us to characterize the payments as child support. The fact that the divorce decree specifies that the payments are to be deducted by Mr. Johnson is not controlling
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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.