Since the average divorce takes between 6 to 10 months to finalize, couples who are hoping to meet the December deadline should already be engaged with a divorce attorney. To be grandfathered-in to the old tax system, divorce settlements must be finalized (which means signed by a judge), by the deadline, and legal matters still in the process of negotiation will not qualify. Many counties require a 30-day waiting period after a settlement agreement is signed, before a judge will sign the documents; thus, settlement agreement should be in the hands of a Judge no later than early November 2018 in hopes of meeting the December 31
st
, 2018 deadline.
Alimony is no longer considered taxable income for the recipient
The new tax bill also relieves alimony recipients from claiming it as taxable income. So, it could be that alimony-payors will be rallying to get their divorce finalized by the deadline, while alimony-recipients will try to drag proceedings past the end of the year.
