# Help- taxes on Alimony from US Ex-hub living in UK



## maenid mom (Mar 2, 2019)

I've tried searching for my situation and come up with nothing tangible, so posting for help...
My ex-husband has moved to London where he has lived now for all of 2019. We were legally divorced in 2017. We discovered that the alimony rules of US (tax deduction for him, taxable income for me) do not work the same in the UK. He gets no tax benefit. So he was in a panic thinking he was going to have to pay me $$$ without tax deduction, and then I'm paying tax again to US. He eventually met with tax attorney in UK who said that the tax treaty would cover this situation. So the Ex has been paying me the post-tax amount (what I would have received once I paid taxes). He told me to file 8833, and that should cover it.
Ha ha ha ha. Like all IRS forms I can't tell what's a noun and what's a verb.
1)This can not be a unique situation. There must be more than just my ex who has moved to UK and continues to have an alimony obligation to a US ex wife.
2) I would really just love the name of an actual, yelp-verifiable, tax attorney in San Fran/Sacramento area who deals with expat taxes. I've searched and not gotten far (found one online outfit but I'd rather meet the person receiving the big check).
If you are familiar with this situation, any advice would be appreciated. Thank you!


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## Moulard (Feb 3, 2017)

Article 17 Paragraph 5 of the US-UK tax treaty reads..



> Periodic payments, made pursuant to a written separation agreement or a decree of divorce, separate maintenance, or compulsory support, including payments for the support of a child, paid by a resident of a Contracting State to a resident of the other Contracting State, shall be exempt from tax in both Contracting States,except that, if the payer is entitled to relief from tax for such payments in the first-mentioned State, such payments shall be taxable only in the other State.


Note that this paragraph is protected by the savings clause. ie. this clause overrides the ability of each state to tax its citizens as if the treaty was not in force.

From the technical explanation...



> Paragraph 5 exempts from tax in both Contracting States such payments made by a resident of one of the Contracting States to a resident of the other Contracting State, unless the payments are deductible in the payer’s State of residence. Thus, child support payments from a resident of a Contracting State to a resident of the other Contracting State are taxable in neither Contracting State, assuming that the payments are not deductible to the payer. By contrast, deductible alimony payments made by a resident of a Contracting State to a resident of the other Contracting State are taxable, exclusively, in the recipient’s State of residence.


So long and the short, if there is no deduction under UK law for an alimony payment from a UK resident, then it is not taxable income for the US resident recipient.


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## Moulard (Feb 3, 2017)

I didn't have a chance to check up on the treasury regulations at the time of my original post, but I did now.. Its worth noting ...



> § 301.6114-1 Treaty-based return positions.
> 
> (c) Reporting requirement waived.
> (2) Reporting is waived for an individual if payments or income items otherwise reportable under this section (other than by reason of paragraph (b)(8) of this section), received by the individual during the course of the taxable year do not exceed $10,000 in the aggregate or, in the case of payments or income items reportable only by reason of paragraph (b)(8) of this section, do not exceed $100,000 in the aggregate.


So you would not need to use Form 8833 so long as the alimony amount was less than 10k USD per year. 

Unfortunately paragraph (c)(4) doesn't include alimony in even though that paragraph covers all the same topics covered by Article 17.


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## maenid mom (Mar 2, 2019)

Moulard, thank you SOOOO much for all of this information. I read through it once. and will do so again. The alimony amount is definitely over $10K, but less than 100K.


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## Moulard (Feb 3, 2017)

I don't think the 100k figure is relevant, paragraph (b)(8) covers cases where the treaty is being used to determine the tax residency of an individual.


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