- 5 - (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 Attorney’s Fees Payment Petitioner argues that he is entitled to an alimony deduction for the $7,500 paid as attorney’s fees to Ms. Salesky’s counsel because the payment satisfies the requirements of section 71. Respondent concedes that while the payment does meet section 71(b)(1)(A) through (C), it fails to satisfy section 71(b)(1)(D) because petitioner would have remained liable to pay the fees in the event of Ms. Salesky’s death. The order directing petitioner to pay Ms. Salesky’s attorney’s fees did not provide whether petitioner’s responsibility to make the payment would terminate in the event of Ms. Salesky’s death. When an order does not specify whether an obligation to make such a payment would cease upon the death of the payee spouse, the Court must turn to the applicable State law to resolve whether the death of a payee spouse would terminate the obligation imposed by the order. Kean v. Commissioner, 407 F.3d 186, 191 (3d Cir. 2005) (interpreting New Jersey law and quoting I.R.S. Notice 87-9, 1987-1 C.B. 422 (“The termination of liability need * * * not be expressly stated in the instrument [if] * * * the termination would occur by operation of State law.”)), affg. T.C. Memo. 2003-163.Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011