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none of the related payments required before death will be
alimony. Sec. 1.71-1T(b), Q&A-13, Temporary Income Tax Regs., 49
Fed. Reg. 34456 (Aug. 31, 1984). Whether such obligation exists
may be determined by the terms of the applicable instrument, or
if the instrument is silent on the matter, by looking to State
law. Morgan v. Commissioner, 309 U.S. 78, 80 (1940); Kean v.
Commissioner, T.C. Memo. 2003-163; Gilbert v. Commissioner, T.C.
Memo. 2003-92, affd. sub nom. Hawley v. Commissioner, 94 Fed.
Appx. 126 (3d Cir. 2004).
Respondent contends that petitioner’s payments to Mrs.
Desauguste are not deductible as alimony because the language of
their separation agreement states that the agreement is binding
on the “heirs” of the agreement and, therefore, the payments
would not be terminated upon Mrs. Desauguste’s death.
In deciding whether the payments were alimony, the Court
examines the language of the June Agreement to ascertain whether
it contains a termination upon death condition, and, if it does
not, whether State law supplies such a condition. Hoover v.
Commissioner, 102 F.3d 842, 847 (6th Cir. 1996), affg. T.C. Memo.
1995-183; see Gonzales v. Commissioner, T.C. Memo. 1999-332; see
also Cunningham v. Commissioner, T.C. Memo. 1994-474. State law
determines certain rights of the parties, and Federal law
determines the Federal income tax consequences of those rights.
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