Thomas Clarence and Claudia Ellen Maloney - Page 6




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          separate households at the time the payment is made, (5) the                
          former spouses do not file a joint return, and (6) the liability            
          for payment does not continue for any period after the former               
          spouse’s death.  See sec. 71(b)(1), (e).  Each of these                     
          requirements must be met before a payor may deduct a payment as             
          alimony.  The parties dispute only two of these requirements;               
          namely, the third and sixth requirements set forth above.                   
               We begin our analysis with the third requirement under which           
          a payment is not treated as alimony if the divorce or separation            
          instrument designates that the payment is not includable in the             
          recipient’s income under section 71 or deductible by the payor              
          under section 215.  See sec. 71(b)(1)(B).  The instrument must              
          contain a clear and explicit designation to that effect although            
          it need not refer expressly to section 71 or section 215.  See              
          Estate of Goldman v. Commissioner, 112 T.C. 317, 323-324 (1999);            
          see also Richardson v. Commissioner, 125 F.3d 551, 556 (7th Cir.            
          1997), affg. T.C. Memo. 1995-554.                                           
               Here, we construe the Virginia decree and the Illinois order           
          as designating the payment in question as nonalimony.  The                  
          Virginia decree provides explicitly that petitioner and Ms.                 
          Maloney shall “both be denied spousal support.”  The Illinois               
          order provides explicitly that petitioner’s transfer of the                 
          $47,900 to Ms. Maloney “shall not be considered a taxable event.”           
          The Virginia decree and the Illinois order, therefore, designate            





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