- 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