Tax Considerations Self-Quiz







Sophia and Edward are in the middle of a divorce. They want to make sure the divorce decree is the most favorable for both parties. Which payment type would be the most attractive for Sophia?

Choice 1 A distribution of the marital residence to Sophia.
Choice 2 An alimony award of $5,000 per month paid to Sophia.
Choice 3 A $100,000 equitable distribution award paid to Sophia.
Choice 4 Premiums on a $50,000 life insurance policy for Edward, naming Sophia as the beneficiary.

Lynette and Jim are in the process of getting divorced. They are confused about the process. Specifically, Jim wants to know which item would be considered deductible.

Choice 1 Child support.
Choice 2 A $1,500 per month alimony payment.
Choice 3 A property settlement of the marital residence.
Choice 4 Lynette’s free use of the vacation house in Maui.

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