Rules: Payments for the support of a spouse are income to the spouse receiving the payments and are deductible to arrive at adjusted gross income by the contributing spouse. Child support is not taxable. Property settlements are not taxable.

Choice "b" is correct. Only the $25,000 in alimony is included in the gross income of the receiving spouse.

Choice "c" is incorrect. This answer option incorrectly includes all of the payments received in the year. The child support ($10,000) and the property settlement ($15,000) are NOT included in the gross income of the receiving spouse.

Choice "d" is incorrect. This answer option incorrectly includes the payments received in the year for alimony and property settlement for the year [$25,000 + $15,000 = $40,000]. The property settlement ($15,000) is NOT included in the gross income of the receiving spouse.

Choice "a" is incorrect. The amount received for alimony ($25,000) is included in the gross income of the receiving spouse.