Which of the Following Statements About Divorce Settlements Is False

question 7

Multiple Choice

Which of the following statements about divorce settlements is false?

• A) Alimony required under a pre-2019 divorce decree is excluded from the recipient's gross income.
• B) Child support is excluded from the recipient's gross income.
• C) Alimony required under a pre-2019 divorce decree is an above-the-line deduction for the payer.
• D) None of these choices arefalse.

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Definitions:

Promissory Note

A financial instrument that contains a written promise by one party to pay another party a definite sum of money either on demand or at a specified future date.

Compounded Semiannually

Interest calculation method where interest is added to the principal on a semiannual basis, leading to interest on interest in the second half of the year.

Quarterly Compounded

Interest calculation method where the accrued interest is added to the principal balance four times a year, allowing interest to be earned on interest.

Annual Rate of Return

The percentage of profit or loss on an investment over a one-year period.