Post-Marriage Income Splitting Through the Deduction for Alimony Payments : A Reply to Professor Schoettle on Lunding v. New York

This article responds to an analysis of Lunding v. N.Y. by Professor Ferdinand P. Schoettle, who argues in favor of the taxpayer in the case relying on free-market economic values. Professor Schoettle criticizes Professor Michael J. McIntyre and Richard D. Pomp's defense of New York's tax laws regarding payment and receipt of alimony by non-residents.Section 1 of this article discusses the tax treatment of alimony under New York law at that time, and the principle that a goal of the New York state income is not to subject taxpayers to unconstitutional double taxation. This section further illustrates the tax logic of the New York system. Section 1 concludes by arguing that the rate differences under New York law do not unconstitutionally favor residents over non-residents. Section 2 agrees with Professor Schoettle that the proper analysis of the alimony issue should proceed under the Commerce Clause. This section also agrees with Schoettle that free trade principles should carry significant weight when determining whether a state has overreached in the taxation of nonresidents. The article concludes by explaining how the New York system for taxing alimony actually promotes free-market values despite Professor Schoettle's concerns, and is constitutional under the Commerce Clause