- 9 - party on behalf of the payee spouse pursuant to the terms of the divorce or separation instrument qualifies as alimony or a separate maintenance payment. Burley argues that the only logical way for him to satisfy the obligations in issue was by making cash payments to third parties. Respondent agrees that the Agreement "necessarily authorized cash payments to third parties to effect its provisions." Alexandra argues that the pertinent provisions of the Agreement do not expressly provide for Burley to make any cash payments to her or on her behalf. Clearly, the cash payments in issue meet the conditions under which cash payments to a third party may satisfy section 71(b)(1)(A). First, we find that the cash payments were made "under" the Agreement. Burley would not have caused the dealership to make the cash payments but for the terms of the Agreement. Second, we find that the cash payments were made "on behalf of" Alexandra because they were made with respect to property and services used solely by Alexandra. Third, we find that the cash payments were not made to maintain property owned by Burley. He had no ownership interest in the leased automobile or in the medical insurance policy. Cf. sec. 1.71-1T(b), Q&A6, Temporary Income Tax Regs., 49 Fed. Reg. 34455 (Aug. 31, 1984). Section 71(b)(1)(B) Alexandra argues that the payments made with respect to the automobile do not satisfy section 71(b)(1)(B) because the partiesPage: Previous 1 2 3 4 5 6 7 8 9 10 Next
Last modified: May 25, 2011