What Are the Maintenance Tax Changes?
The maintenance tax deduction for cases finalized after December 31, 2018, has been eliminated. To account for this change in the tax law, effective January 1, 2019, Illinois’ new maintenance guidelines will be based on net income - 33 1/3% of payor’s net income minus 25% of payee’s net income capped at 40% of the parties combined net income. Maintenance guidelines will continue to be applicable up to $500,000 of combined gross income. All maintenance judgments entered prior to December 31, 2018 will continue to be deductible even if modified after December 31, 2018 unless agreed otherwise. Those awards will continue to utilize the current gross incomes guidelines of 30% of payor’s gross income minus 20% of payee’s gross income capped at 40% of the parties combined gross income.