Pamela L. Light - Page 6

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               Section 71(b)(2) defines a “divorce or separation                      
          instrument” as:                                                             
                    (A) a decree of divorce or separate maintenance or a              
               written instrument incident to such a decree,                          
                    (B) a written separation agreement, or                            
                    (C) a decree (not described in subparagraph (A))                  
               requiring a spouse to make payments for the support or                 
               maintenance of the other spouse.                                       
          Characterization of Monthly Payments                                        
               Petitioner argued that none of the $1,400 monthly payments             
          she received in 2002 should be included in her gross income under           
          section 71(a) because she and Mr. Gutzler had a “handshake                  
          understanding” that the payments were not alimony.  Petitioner              
          testified to an oral agreement between Mr. Gutzler and her that             
          purportedly took place concurrent with the order.  It provided              
          that Mr. Gutzler would not deduct the payments, nor would                   
          petitioner include the payments as income, if she used the                  
          payments solely for her attorney’s fees, payment of Mr. Gutzler’s           
          automobile insurance, and payments on an automobile in Mr.                  
          Gutzler’s possession.  Petitioner now asks this Court to reject             
          the underlying order and agreement and, in the alternative,                 
          consider evidence:  (1) Of a “handshake” agreement, and (2) that            
          the terms of the “handshake” agreement should supplant the                  
          meaning of alimony pendente lite and alimony as used in the order           
          and the agreement.  Since petitioner disputes the legal effects             

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