California Ends Alimony Tax Deduction: Why Florida Has the Edge

California Just Changed Its Alimony Tax Rules — And It Highlights Why Florida Is Different

According to the California Franchise Tax Board, a significant tax change took effect on January 1, 2026: under SB 711, alimony payments made pursuant to new divorce agreements are no longer tax-deductible for the payer at the California state level, and recipients no longer report those payments as taxable income. As reported by Family Law Software, this change finally aligns California with the federal tax rules that have been in place since the Tax Cuts and Jobs Act of 2017 eliminated the federal alimony deduction for agreements executed after December 31, 2018.

For seven years, California maintained its own rules. If you were paying spousal support under an agreement signed between 2019 and 2025, you could still deduct those payments on your California state return even though you got no deduction on your federal return. Recipients had to report alimony as income on their state return but not their federal one. The result was a confusing dual-tax system that required Schedule CA adjustments and often caught people off guard during tax season.

That era is now over. But here in Florida, we never had that problem in the first place — and the reasons why matter a great deal if you are negotiating spousal support right now.

Why This Story Matters Beyond California

California is not the only state that had to reconcile its tax code with the federal changes. Several states maintained their own alimony deduction rules after 2018, creating a patchwork of tax treatment that complicated divorce settlements for anyone living in — or moving between — different states.

The broader trend is clear: states are falling in line with the federal approach. Under current federal law, alimony is a tax-neutral event. The person paying spousal support pays with after-tax dollars, and the person receiving it does not owe income tax on the payments. This shifts the tax burden entirely to the payer, which has changed the math on spousal support negotiations nationwide.

For divorcing couples in high-income-tax states, this alignment eliminates one of the last remaining tax-planning opportunities around alimony. In California, where the top marginal state income tax rate exceeds 13%, that lost deduction represents real money.

Florida's No-Income-Tax Advantage in Alimony Cases

Florida has no state income tax. Period. That means neither the payer nor the recipient of spousal support faces any state-level tax consequence — and this has been true regardless of when the divorce agreement was executed. There was never a confusing transition period, never a need for special schedule adjustments, and never a mismatch between state and federal rules.

This is not just a technicality. It has practical implications for how spousal support is negotiated and structured in Florida.

When I work with clients on alimony negotiations, the calculation is straightforward from a tax perspective. We only need to account for federal tax treatment. In states like California (at least until this year), attorneys had to run two separate tax analyses — one for federal purposes and one for state — and the numbers could diverge significantly. That complexity added cost, created room for error, and made it harder for both sides to agree on what a "fair" support number actually looked like.

Florida eliminates that layer of complexity entirely.

Under Florida Statute 61.08, courts consider a range of factors when awarding alimony, including the standard of living during the marriage, the duration of the marriage, each party's financial resources, and earning capacity. The tax treatment of alimony is baked into those negotiations, and in Florida, the analysis is cleaner because there is no state tax variable to account for.

If you are just beginning to think about divorce and wondering what your financial picture looks like, our first-steps checklist walks you through the early decisions that shape the rest of the process.

The Relocation Factor: Moving to Florida Before or During Divorce

California's SB 711 underscores something that high-net-worth individuals and their advisors have understood for years: where you live when you divorce has enormous financial consequences.

Florida has long been a destination for people leaving high-tax states, and the divorce tax landscape is one reason why. If you are a high earner paying six figures in annual spousal support, the absence of state income tax in Florida means you keep more of your income compared to someone in the same situation in California, New York, or New Jersey.

This does not mean you can simply move to Florida the week before filing for divorce and claim residency. Florida requires that you be a bona fide resident for at least six months before filing a dissolution of marriage petition. Courts in both states can scrutinize the timing and intent of a move, especially when significant assets are involved. But for individuals who are genuinely relocating — or who already split time between states — establishing Florida residency before initiating divorce proceedings is a legitimate and often significant financial strategy.

For a deeper look at how taxes intersect with Florida divorce, including filing status decisions and exemptions, I have written a detailed guide on tax implications of Florida divorce in 2026.

What This Means for You

If you are a Florida resident going through a divorce, California's law change does not directly affect you. But it reinforces several things worth knowing:

• Your spousal support negotiations are simpler than they would be in most other states because there is no state tax layer to complicate the math.
• If you or your spouse recently relocated from a high-tax state, the financial advantages of Florida residency should be factored into your settlement strategy.
• If you have an existing alimony agreement from a prior divorce in another state, the tax treatment may depend on when that agreement was executed and which state's rules apply. This is an area where getting professional tax and legal advice is essential.
• Florida's 2023 alimony reform (SB 1416) eliminated permanent alimony and established durational caps tied to the length of the marriage. Combined with no state income tax, Florida's alimony framework is among the most structured and predictable in the country.

The Bigger Picture

Every time another state aligns with the federal alimony tax rules, it reinforces a reality that divorce attorneys have been navigating since 2019: spousal support is no longer the tax-shifting tool it once was. The old system, where payers deducted alimony and recipients reported it as income, allowed for creative structuring that could reduce the combined tax burden for both parties. That flexibility is gone at the federal level and is now disappearing at the state level too.

In Florida, we have adapted. Negotiations focus more heavily on the net amounts each party will actually receive and pay, without the distortion of tax deductions. In my practice, I find this actually leads to cleaner, more transparent negotiations — both sides can see exactly what the numbers mean without having to layer on tax assumptions.

That said, the financial details of any divorce are complex, and alimony is just one piece of the puzzle. Debt division, asset classification, and support calculations all interact with each other. If you are trying to understand how debt is handled or how the financial affidavit process works, those are critical pieces to get right early in the process.

Frequently Asked Questions

Is alimony tax-deductible in Florida in 2026?

Florida has no state income tax, so there is no state-level deduction or tax liability for alimony payments. At the federal level, alimony payments under agreements executed after December 31, 2018, are not deductible by the payer and not taxable to the recipient. If your agreement predates 2019 and has not been modified, the old federal rules (deductible to payer, taxable to recipient) may still apply.

How does California's SB 711 affect me if I moved from California to Florida?

If you finalized your divorce in California under an agreement signed between 2019 and 2025, your alimony may have been deductible on your California state return. Now that you live in Florida, you have no state income tax obligation at all. However, if you still owe California taxes for prior years or have California-source income, you should consult a tax professional about any residual state obligations.

Why does it matter which state I live in when I file for divorce?

Your state of residence determines which state's divorce laws apply, including alimony formulas, property division rules, and — critically — the tax treatment of support payments. Florida's combination of no state income tax, structured alimony reform, and equitable distribution laws makes it one of the more financially favorable states for divorce. Residency must be established for at least six months before filing.

Thinking About Your Options?

If you are navigating alimony negotiations in Florida — whether you are a longtime resident or recently relocated from a high-tax state — the financial stakes are significant, and the details matter. Contact Divorce.law to schedule a strategy session and get clarity on how Florida law applies to your specific situation.

This article discusses recent news and provides general legal commentary. It does not constitute legal advice and should not be relied upon for legal decisions. Every divorce case is unique. If you are facing a similar situation, consult with a qualified Florida family law attorney. Contact Divorce.law for a strategy session.