Alimony During the Year of Separation: Tax Court Allows Deduction for Special Expenses in Individual Tax Assessments

Realsplitting is a tax mechanism that allows alimony payments to a divorced or permanently separated spouse to be claimed as special deductions. The paying spouse thereby reduces their taxable income, while the receiving spouse is taxed on the payments as other income. Until now, it was disputed whether “Realsplitting” could be used as early as the year of separation, even if the spouses could theoretically still opt for the more favorable joint assessment. A recent ruling by the Düsseldorf Tax Court dated July 23, 2026, provides clarity—in favor of taxpayers.

At a Glance

Alimony payments to a spouse living permanently separated are deductible as special expenses as early as the year of separation if both spouses opt for separate assessment. The mere possibility of applying for joint assessment instead does not preclude the deduction of special expenses. The ruling by the Düsseldorf Fiscal Court is not yet final—an appeal to the Federal Fiscal Court has been granted.

What Is “Realsplitting”?

Under so-called “real splitting” pursuant to Section 10( 1a No. 1 of the Income Tax Act (EStG), the spouse obligated to pay support may deduct support payments made to a divorced or permanently separated spouse as special expenses up to a maximum amount of currently 13,805 euros per year. One of the requirements is that the recipient consents to the deduction and, for their part, reports the payments received as other income for tax purposes. For couples with significantly different incomes, “realsplitting” can result in a noticeable overall tax savings.

The Case in Question: Separation and Individual Tax Assessment in the Same Year

A married couple separated during the course of the year. For this year of separation, both opted for separate tax assessment. The husband made alimony payments to his separated wife and claimed these as special expenses under the “Realsplitting” system.

The tax office denied the deduction. The reasoning: During the year of separation, the spouses could still have opted for joint assessment, since they were still living together at the beginning of the year. As long as this option exists, the couple is still treated as a single economic unit for tax purposes. In this scenario, “real splitting” is superseded by the provisions governing the taxation of married couples.

The Düsseldorf Tax Court: The deduction is permissible

The judges did not accept this argument and ruled in favor of the plaintiff. The factual requirements for “realsplitting” were indisputably met: The husband was permanently separated from his wife, he made alimony payments, and both had opted for separate taxation.

The decisive question was whether the mere theoretical possibility of joint assessment precludes the special expenses deduction. The Tax Court clearly rejected this. What matters, it held, is not which form of assessment the spouses could have chosen, but which one they actually chose. If both spouses opted for separate assessment, the requirements for “realsplitting” are met.

The court based its decision on several arguments: The wording of the law contains no restriction regarding the separation year. Furthermore, the legislative history and the purpose of the provision—namely, to provide tax relief to the person obligated to pay alimony—support allowing “realsplitting” in this scenario.

What does this mean for those affected?

For married couples who separate during the course of a year, the ruling opens up an important tax planning opportunity. In many cases, joint assessment during the year of separation does offer the greatest combined tax benefit. However, there are situations in which separate assessment combined with “realsplitting” may be more advantageous—for example, if one spouse makes very high alimony payments and the other has only a small amount of income of their own, or if the spouses cannot agree on a joint assessment.

Important to note: The ruling is not yet final. An appeal to the Federal Fiscal Court has been granted and is pending there under case number X R 23/26. Until the matter is clarified by the highest court, those affected should claim the special expenses deduction in comparable cases and, if rejected by the tax office, file an appeal citing the pending appeal proceedings to keep their own assessment open.

Frequently Asked Questions About “Realsplitting” During the Year of Separation

What is the difference between “Realsplitting” and “spousal splitting”?

Under spousal splitting, both spouses file a joint tax return and benefit from a more favorable tax rate. With “real splitting,” spouses file separate tax returns, and the spouse obligated to pay spousal support can deduct those payments as special expenses. “Real splitting” requires a permanent separation or divorce.

Can I freely choose between joint and separate tax assessments during the year of separation?

Yes. As long as the spouses lived together on at least one day of the year, they are eligible for joint filing. However, they may also opt for separate filing. According to a ruling by the Düsseldorf Tax Court, separate filing is already possible during the year of separation in this case.

Does the spouse receiving alimony have to consent to “real splitting”?

Yes. The special expense deduction for the payer requires the recipient’s consent. In return, the recipient must report the alimony payments as other income on their own tax return. If the recipient refuses to give consent, they may be required to do so under certain circumstances, but must be compensated for any resulting tax disadvantages.

What should I do if my tax office denies the deduction during the year of separation?

File an appeal and refer to the pending appeal proceedings before the Federal Fiscal Court (Case No. X R 23/26). If necessary, request that the proceedings be stayed until the Federal Fiscal Court has rendered a decision. This will keep your tax assessment open, allowing you to benefit from a favorable decision.

This article was reviewed by the tax advisors and certified public accountants at Trimborn . Partner.

About Trimborn . Partner

Trimborn . Partner is an award-winning tax consulting and auditing firm with offices in Düsseldorf and Oberhausen. As experienced tax advisors, we assist individuals with all tax-related matters concerning separation and divorce—from determining the optimal method of assessment and real splitting to the inclusion of alimony payments in tax returns. If you’d like to know what tax planning options are available to you during the year of separation, our tax advisory experts in Düsseldorf and Oberhausen are happy to assist you.