- 8 - alimony and are thus not includable in Alexandra's gross income or deductible by Burley and Mary. The parties do not dispute that the requirements of section 71(b)(1)(C) and (D) have been satisfied with respect to the amounts in issue. Section 71(b)(1) The initial requirement under this section is that the payments must be in cash. Sec. 71(b)(1). Section 1.71-1T(b), Q&A 5, Temporary Income Tax Regs., 49 Fed. Reg. 34455 (Aug. 31, 1984), explains that only cash payments, including checks and money orders payable on demand, qualify as alimony or separate maintenance payments. Transfers of services or property, execution of a debt instrument by the payor, or the use of property of the payor do not qualify. Id. We are satisfied that the dealership's cash payments for the lease, insurance, and maintenance of the automobile for Alexandra's benefit and for the reimbursement of Alexandra's medical insurance premiums are properly treated as cash payments made by Burley during 1994. He included these amounts in income as constructive dividends and is entitled to any allowable deductions for the amounts paid. Section 71(b)(1)(A) We next examine whether the cash payments treated as made by Burley satisfy section 71(b)(1)(A). Section 1.71-1T(b), Q&A6, Temporary Income Tax Regs., 49 Fed. Reg. 34455 (Aug. 31, 1984), provides that a payment of cash by the payor spouse to a thirdPage: Previous 1 2 3 4 5 6 7 8 9 10 Next
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