Monies from Divorce

[Traci C]

I was divorced in 2007. A part of the divorce decree was that when the business sold, I got $10K out of the  $24K in divorce decree for reimbursement of start-up business expenses. Is it taxable?

[JillS56 · Accepted solution]

No, if the proceeds from the business sale that you are receiving are to reimburse you for start-up business expenses, no it is not taxable.  You are receiving money that you paid out or invested in the business, this is not considered income. 

Now if you received more than the $24,000 of start-up costs, then anything you received over the $24,000 would be taxable.

[Traci C]

Thank you!