I had a very similar situation happen to me a couple of years ago! My husband's W-4 was incorrectly filled out and we didn't realize until we got his year-end W-2 that showed almost no federal withholding. The first thing you need to do is get a copy of your wife's current W-4 from her employer's HR department. Look specifically at Step 4(c) to see if she accidentally checked the "Exempt" box - this is by far the most common reason for zero withholding. The exempt status is only supposed to be used if you had no tax liability last year AND expect to have none this year, which is pretty rare for working adults. Another possibility is that she made an error in Step 2 (Multiple Jobs or Spouse Works). The new W-4 tries to coordinate withholding between spouses, but it's easy to fill out incorrectly. Once you identify the problem, have her submit a corrected W-4 immediately. Then I'd strongly recommend using the IRS Tax Withholding Estimator online to calculate if you need to make estimated tax payments to catch up. We ended up owing about $3,800 at tax time plus a small penalty, but we could have avoided both if we'd caught it earlier. Don't stress too much - this is fixable! Just act quickly so you don't end up with a huge surprise bill next April.

I actually went through this exact situation with my spouse last year! Zero federal withholding for almost half the year before we caught it. Here's what I learned from that stressful experience: First, get a copy of your wife's W-4 from HR immediately - like Monday morning. In our case, my spouse had accidentally checked "Exempt" without understanding what it meant. The exempt status is only for people who owed no taxes last year AND expect to owe none this year, which almost never applies to working adults. Second possibility is the "Multiple Jobs or Spouse Works" section (Step 2) was filled out incorrectly. The new W-4 form tries to coordinate withholding between spouses, but it's really confusing and easy to mess up. Once you fix the W-4, use the IRS Tax Withholding Estimator to see if you need to make estimated quarterly payments. We ended up owing about $5,100 at tax time plus a $220 underpayment penalty because we didn't catch it until October. The good news is this is totally fixable if you act fast! Every paycheck without proper withholding just makes the eventual tax bill bigger. Don't panic, but definitely treat this as urgent. We were able to minimize the damage by making estimated payments once we figured out what was wrong.

A bit off-topic but if your mom is struggling financially after losing your dad, has she checked if she's eligible for survivor benefits from Social Security? My mom was in a similar situation and the extra monthly income made a huge difference. Might help reduce the amount you need to help with going forward.

Just wanted to add another perspective from someone who went through this exact situation. When my father-in-law passed, I helped my mother-in-law with her bills in a similar way. One thing that really helped was setting up a simple spreadsheet to track all payments I made on her behalf - date, amount, what bill it was for, etc. This documentation became invaluable when I had to file Form 709. The IRS wants clear records of all gifts over the annual limit, and having everything organized made the process much smoother. Also, if any of those credit card charges were for things like prescription medications, you might be able to pay the pharmacy directly going forward to take advantage of the medical payment exception others mentioned. The emotional side is tough too - it's hard to see a parent struggle financially, but you're doing the right thing helping her. Just make sure you're taking care of the tax side properly so there are no surprises down the road.

As someone who spent 2 hours on the phone with MA Department of Revenue last week, I can confirm it's definitely line 21 they want. BUT also be prepared to explain any big differences between last year's income and your current situation. They asked me a ton of questions because my business is doing much better this year than last year.

I went through this exact same situation with Massachusetts DOR about 6 months ago! Just to confirm what others have said - yes, it's definitely line 21 (Ordinary business income) from your Form 1120S that they want for the DOR-APP form. One thing I wish someone had told me beforehand: if your line 21 shows a loss (negative number), don't panic. The DOR will still work with you on a payment plan, but they'll want to see more recent financial information like current profit/loss statements or bank statements to understand your ability to pay. Also, when you submit the form, include a brief cover letter explaining your situation. I found the MA DOR staff to be surprisingly helpful once I actually got through to them. They even waived some penalties because I was proactive about setting up the payment plan. Good luck!

This is such a helpful thread! I'm dealing with a similar situation where my 2017 divorce agreement was modified in 2024, and like the original poster, our modification is silent on tax treatment. Reading through everyone's experiences, it sounds like I should be able to continue deducting my alimony payments since there's no explicit language in the modification adopting the new tax rules. But I'm curious - has anyone here actually been through a tax season filing this way and had any issues with the IRS? Also, @Rudy Cenizo, that addendum language your attorney suggested is brilliant. I wish I had thought of that before we finalized our modification. For anyone else reading this who hasn't modified yet, definitely consider adding that protective language! One question for the group - if I continue taking the deduction based on the silence in my modification, should I attach any documentation to my tax return explaining the situation, or just file normally and keep the divorce documents in case of questions later?

This thread has been incredibly helpful! I'm in a very similar situation - divorced in 2015, modified the agreement in 2024 with no mention of tax implications. After reading everyone's experiences, I feel much more confident about continuing to take the deduction. What really stands out to me is how consistent everyone's advice has been: if the modification doesn't explicitly state that the new tax rules apply, then the original pre-2019 treatment continues. The IRS seems to have written this rule pretty clearly - they require express language, not implied or assumed changes. For anyone else in this situation, I'd recommend: 1. Keep copies of both your original divorce decree AND the modification 2. Make sure your ex-spouse understands they still need to report the payments as income 3. Consider adding protective language to any future modifications (like @Rudy Cenizo suggested) 4. Keep detailed records of all payments It's frustrating that the IRS publications aren't clearer about this, but based on everyone's real-world experiences here, it seems like we're interpreting the law correctly. Thanks to everyone who shared their stories - it's so much more helpful than trying to decode tax publications alone!

One thing nobody has mentioned yet is that Section 117(d)(5) has been on shaky ground in recent years. During the 2017 tax reform discussions, there was talk of eliminating this exclusion entirely, which would have made all graduate tuition waivers taxable income. While it survived that round, it's always possible future tax legislation could modify or remove this benefit. Make sure whatever documentation you rely on is current. The IRS Publication 970 (Tax Benefits for Education) gets updated annually and contains official guidance on these educational tax benefits. Always worth checking the most recent version!

Just to add another perspective - I work in university payroll and see these situations frequently. The distinction everyone's discussing between 117(d)(5) and Section 127 benefits is crucial, but there's one more wrinkle to consider. If you're classified as more than a half-time employee (typically 20+ hours per week), some universities will automatically categorize ALL your tuition benefits under Section 127 rather than 117(d)(5), even if you're also teaching. This is because they view your primary relationship with the university as "employee" rather than "student." I'd strongly recommend getting written clarification from both your graduate school AND your HR department about how they're classifying your benefits. Don't assume that teaching one class automatically qualifies you for 117(d)(5) treatment if you're primarily employed in administration. The IRS looks at the substance of the relationship, not just the presence of teaching duties. Also, if your university is treating this inconsistently or you're getting conflicting information, document everything. You may need to make your own determination based on the facts and circumstances of your situation.