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includable in gross income * * * and not
allowable as a deduction under section
215,
(C) in the case of an individual
legally separated from his spouse under
a decree of divorce or of separate
maintenance, the payee spouse and the
payor spouse are not members of the same
household at the time such payment is
made, and
(D) there is no liability to make
any such payment for any period after
the death of the payee spouse and there
is no liability to make any payment (in
cash or property) as a substitute for
such payments after the death of the
payee spouse.
Both parties agree that petitioner’s payments to his ex-wife
satisfied the requirements set out in section 71(b)(1)(A), (B),
and (C). Payment was made in cash, made pursuant to a “divorce
or separation instrument” as described in section 71(b)(2)(C),
and the payment was not ineligible for the section 71 and 215
deduction/inclusion scheme. At the time of payment, petitioner
and his ex-wife were not members of the same household. The
disagreement in this case is solely about whether petitioner’s
payments satisfied section 71(b)(1)(D); i.e., whether
petitioner’s liability to make payments would have terminated in
the event of his ex-wife’s death. If the payments would have
terminated in the event of his ex-wife’s death, the payments
would have been “alimony”. Because it seems clear that
petitioner’s payments would not have terminated in the event of
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Last modified: November 10, 2007