Nada Nahhas - Page 7

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                    (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.                                             
               The test under section 71(b)(1) is conjunctive; a payment is           
          deductible as alimony only if all four requirements of section              
          71(b)(1) are present.  See Jaffe v. Commissioner, T.C. Memo.                
               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 a subparagraph (A))                
               requiring a spouse to make payments for the support or                 
               maintenance of the other spouse.                                       
               Section 71(c)(1) provides that the general inclusion rule of           
          section 71(a) for alimony and separate maintenance payments in              
          gross income does not apply to “any payment which the terms of              
          the divorce or separation instrument fix (in terms of an amount             
          of money or a part of the payment) as a sum which is payable for            
          the support of the children of the payor spouse.”                           
          I.  Characterization of Monthly Payments                                    
               Petitioner argues that none of the monthly payments she                
          received in 2002 as “unallocated maintenance and support” from              
          Mr. Nahhas should be included in her gross income since the                 
          amounts are properly characterized as nontaxable child support.             

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