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Respondent determined a deficiency of $1,363 in
petitioner’s Federal income tax for taxable year 1997. The sole
issue for decision is whether petitioner is entitled to exclude
from income, the payments she received from a former spouse
incident to a divorce proceeding.
This case was submitted fully stipulated without trial under
Rule 122. The accompanying exhibits are incorporated herein by
reference.
Background
Petitioner resided in Astoria, Oregon, at the time her
petition was filed in this case.
Petitioner's marital relationship with her former husband
was dissolved by a decree of dissolution of marriage (decree) by
the Circuit Court of the State of Oregon, the final and effective
date of which was January 18, 1986. The decree includes a
provision providing that her former husband will pay to her "a
sum of money equaling one-half of monthly net amount, after
deductions for federal and state taxes, of the U.S. Coast Guard
retirement pension received by [petitioner's former husband].
Payment to [petitioner] shall not be included as taxable income
to [petitioner], nor shall such payments be deductible by
[petitioner's husband]." The decree directs that the payments be
made directly to petitioner and continue until the mortgage on
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