- 11 -
death of Ms. Springer, then these payments are alimony under
section 71 and deductible from petitioner’s gross income under
section 215(a). See Lovejoy v. Commissioner, 293 F.3d 1208, 1210
(10th Cir. 2002), affg. Miller v. Commissioner, T.C. Memo. 1999-
273. The parties dispute (1) whether the divorce documents would
have required termination of the annual payments on the death of
Ms. Springer, and (2) whether the liability to make the annual
payments would have terminated under Nebraska law. Additionally,
respondent argues that the annual payments were intended to be
“alimony in gross” under Nebraska law and that this implies that
petitioner cannot deduct the $50,000 payment.
Current section 71 is the product of the Deficit Reduction
Act of 1984, Pub. L. 98-369, sec. 422, 98 Stat. 795, and the Tax
Reform Act of 1986, Pub. L. 99-514, sec. 1843(b), 100 Stat. 2853.
In Hoover v. Commissioner, 102 F.3d 842, 845 (6th Cir. 1996),
affg. T.C. Memo. 1995-183, the Court of Appeals for the Sixth
Circuit explained that by the 1984 revision, “Congress
specifically intended to eliminate the subjective inquiries into
intent and the nature of payments that had plagued the courts in
favor of a simpler, more objective test.” The statute as enacted
in 1984 required that the divorce or separation instrument itself
state that the liability to make payments would terminate on the
payee’s death. The 1986 amendment eliminated the requirement
that the termination provision be stated in the instrument itself
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011