April 12, 2010

Records to Keep When Paying or Receiving Spousal Support

During the divorce process clients must deal with the very burdensome process of discovery.  The record keeping process does not end with the end of a case.  When there is an award of spousal support, both parties should continue to keep very careful records.  In some instances, spousal support will be withheld from a person’s wages.  The benefit of having state enforced support is that the state will take on the burden of record keeping.  Unfortunately the state does make mistakes, and it is important to keep backup records.  These records are important for both tax purposes and for potential future litigation purposes.

The person paying spousal support should:

  • Make a detailed spreadsheet which lists all payments made.  The method of payment, check number, date, and the address to which the check was sent or direct deposit made should all be listed.  In addition, a copy of the outgoing payment should be kept;
  • If payments are going to be made in cash, then the payee should sign a receipt at the time payment is accepted. 

The person receiving support should:

  • Make a detailed spreadsheet which lists all payments received.  Including, the date the payment was received, the amount received, the check number or electronic payment record, the bank and account from which the payment was made.
  • In addition, a copy of the payment should be kept.

Both parties should be aware of the tax impact of spousal support payment or receipt and should discuss how to appropriately deal with tax issues with his/her CPA.  You should contact a lawyer if you have any questions about your current spousal support award.