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adjustment to Ms. Jaffe's itemized deduction for medical and
dental expenses, due to the inclusion of $18,500 alimony in her
gross income for 1994. As noted earlier, respondent filed
answers in each case asserting increased deficiencies against Mr.
and Ms. Jaffe for the unreported dividend income.
OPINION
The Alimony Issue.
At issue here is the nature of the withdrawals made by Ms.
Jaffe during 1994 out of the jointly held account with Mr. Jaffe.
Amounts received as alimony or separate maintenance are
includable in the recipient's gross income under sections
61(a)(8) and 71(a) and are deductible by the payor under section
215(a) in the year paid. On the other hand, payments
representing a property settlement are neither deductible to the
payor nor includable in income by the recipient. See sec. 1041.
For tax purposes, the term "alimony or separate maintenance
payment" is defined in section 71(b)(1) as any payment in cash
meeting the following four criteria:
4(...continued)
Government's right to tax revenue is recognized as a valid
practice. See, e.g., Gerardo v. Commissioner, 552 F.2d 549, 555-
556 (3d Cir. 1977), affg. in part and revg. in part on another
ground T.C. Memo. 1975-341.
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