Question
Ali instructs his employer to forward $200 per week from his salary to his ex-wife, Bambi, in order for Ali to meet his maintenance responsibilities
Ali instructs his employer to forward $200 per week from his salary to his ex-wife, Bambi, in order for Ali to meet his maintenance responsibilities as instructed by the Family Court. Which of the following statements best describes the taxation treatment of the weekly $200 payment? A. The amount is assessable to Ali as it is a constructive receipt. B. The amount is not assessable to Ali as he has not received it. C. The amount is assessable to Bambi as it is a regular, periodic payment that she looks to for her upkeep. D. The amount is assessable to Bambi as she is the recipient of an amount originally paid as a reward for service. E. The amount is not assessable to either Ali or Bambi.
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