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Prior to the entry of the Judgment, Marta received $63,170
(10 bimonthly payments of $6,317) from Norman in compliance with
the terms of the Tentative Decision as incorporated into the
Minute Order. In addition, Norman made a total of $82,121 in
bimonthly spousal support payments to Marta during the period
from June 9, 1992, through December 31, 1992.
Norman timely filed a Form 1040, U.S. Individual Income Tax
Return, for taxable year 1992. Norman claimed as a deduction on
Line 29, "Alimony paid", of his return the entire amount of
spousal support he remitted to Marta during that year--$145,291.
Marta also timely filed a Form 1040 for 1992. On her
return, Marta reported as income on Line 11, "Alimony received",
only that portion of spousal support that she received after the
entry of the Judgment--$82,121.
In the role of a stakeholder, respondent issued separate
notices of deficiency to Norman and Marta on May 21, 1996,
addressing petitioners' inconsistent treatment of the support
payments made prior to the entry of the Judgment. Among other
adjustments, in the notice issued to Norman, respondent
disallowed the deduction of $63,170 as alimony paid. In the
Explanation attached to the notice of deficiency, respondent
stated that Norman had neither established that such amount was
alimony, nor that such amount was paid.
In the notice of deficiency issued to Marta, among other
adjustments, respondent determined that the $63,170 of payments
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