Does a husband's income tax return need to include a Mexican divorce as part of his income tax calculation?

This particular liberalization of the conditions under which support payments are includible in the gross income of the wife and deductible by the husband occurred in 1954, two years after the date of the Mexican decree. Yet it would be most undesirable to restrict the recognition of the Mexican divorce to the years following 1954; and those principles and aspects of the tax scheme, including the general income-splitting provisions for a husband and wife filing a joint return, that made it appropriate to charge the wife-recipient with the support payments and to allow a deduction for the husband-payor, were already in existence in 1952. Moreover, we do not regard the fact that this liberalization required that there exist a separation agreement executed after the enactment of the provision as removing one of the underpinnings of the rule of validation as applied in this case, involving a "divorce" that preceded that date. We understand this limitation to express a Congressional desire not to upset established pre-existing arrangements that most likely had taken possible tax effects into consideration in determining the size of the payments, see Mavity v. Commissioner, supra, 341 F.2d at 868. It did not reflect the judgment that voluntary separation formalized by an agreement executed prior to that date were not in principle entitled to the tax treatment afforded to voluntary separations formalized by an agreement executed after that date. Presumably the tax consequences of the 1952 Mexican divorce were not anticipated in the 1946 agreement.⁸ But that would be true even if the Mexican divorce were left uncontested or declared valid in the subsequent New York declaratory proceeding. The proper remedy would seem not to adjust the tax statutory concept of a divorce but to adjust the size of the payments, if need be, through state judicial proceedings.