The Alimony Deduction and Non-Residents

By Levin, Mark H. | The CPA Journal, August 1996 | Go to article overview

The Alimony Deduction and Non-Residents


Levin, Mark H., The CPA Journal


New York State has lost another round in their never-ending attempt to deny nonresidents of New York State the deduction allowed for alimony paid, in the Matter of the Petition of Christopher H. Lunding et al. v. Tax Appeals Tribunal of the State of New York et al., New York Supreme Court, Appellate Division, Third Department, No.74021, March 14, 1996.

Before discussing Lunding, a brief history of New York's tax treatment of alimony paid is appropriate.

Since 1976, when the Federal treatment of alimony was changed from an itemized deduction to an adjustment toward Adjusted Gross Income, New York had taken the position that the adjustment for alimony was governed by Tax Law Sec. 632(a)(1) (old law prior to 1988), which limited adjustments to income to those amounts derived from or connected with New York sources. Based on Sec. 632(a)(1), the Department of Taxation and Finance administratively took the position that alimony was not connected with, or derived from, New York source income.

In 1985, the Department of Taxation and Finance issued Technical Services Bureau Memorandum TSB-M-85(7)-I (the TSB-M) in response to the NYS Court of Appeals decision in the Matter of Lance J. Friedsam v. State Tax Commission, 192 N.Y.LJ. No. 122, p.19 (December 27, 1984).

In Friedsam, the New York State Court of Appeals held on statutory, not constitutional, grounds that New York must allow an alimony deduction as an "adjustment to income" in the same manner that it was previously allowed as an itemized deduction. In response to this decision, the Department of Taxation and Finance issued Technical Services Bureau nK memorandum, TSB-M-85-(7)-I, which spells out how to compute the alimony paid adjustment for nonresidents. The TSB-M defined how a nonresident should compute the amount of the Federal alimony paid adjustment that may be deducted against New York source income.

The computation as defined in the TS&M is shown in the Figure.

The TSB-M remained in effect until 1987, when the Tax Law was amended and Sec. 631(b)(6) was added.

Effective for years beginning after 1987, alimony was disallowed, by statute, as a deduction for nonresidents under Tax Law Sec. 631(b)(6), which states, "The deduction allowed by section two hundred fifteen of the internal revenue code relating to alimony, shall not constitute a deduction derived from New York Sources." Since the enactment of Sec.631(b)(6), New York has disallowed any alimony deduction taken against New York income

As mentioned previously, in March 1996 the Appellate Division, once again, handed down a decision that overturns New York's position with respect to the allowance of an alimony paid adjustment against New York source income.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

The Alimony Deduction and Non-Residents
Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.