If you’re considering divorce in 2026, a new California law will change how spousal support is taxed. Senate Bill 711 reshapes the financial planning process for divorcing couples, and understanding the updates now can help you move forward with more clarity and confidence.
In a traditional litigation model, these shifts can feel overwhelming. In a collaborative divorce, however, the same changes become opportunities for thoughtful planning with the support of a professional team.
What SB 711 Changes
SB 711 brings California in line with current federal law on the tax treatment of spousal support. For spousal support orders executed on or after January 1, 2026, the rules will be:
- Spousal support is not tax-deductible for the payor for California income tax.
- Spousal support is not taxable income to the recipient for California income tax.
This marks a shift from California’s prior system, where support was generally deductible to the payor and taxable to the recipient at the state level. Since 2019, federal law has already removed these deductions and taxes under the Tax Cuts and Jobs Act—creating a mismatch between federal and state treatment.
SB 711 eliminates that mismatch, creating one consistent framework beginning in 2026.
What This Means for Your Finances
Here’s a simplified example of how the change affects real dollars:
Under the old California rules:
A payor spouse contributes $3,000/month ($36,000/year) in spousal support and deducts that amount from California taxable income—saving roughly $3,240 in state taxes (assuming a 9% bracket). The recipient reports the $36,000 as income and pays roughly the same amount in state taxes.
Under SB 711 (2026 forward):
A payor spouse contributes $3,000/month with no California deduction. The recipient receives the support tax-free for California income tax purposes.
Bottom line:
The recipient keeps more of what they receive, and the payor no longer gets a tax benefit. This shift encourages couples to think more holistically about what’s fair and sustainable for both households.
Why This Matters for Sacramento Families
For Sacramento families navigating divorce, SB 711 redirects the conversation to a core question:
How much spendable income does each person have after taxes each month?
Spousal support needs to be structured so that both spouses can meet their needs and maintain stability—not just comply with formulas or old assumptions about tax impacts.
How Collaborative Divorce Helps You Navigate SB 711
In a collaborative divorce, SB 711 becomes a starting point for strategic and creative financial planning. The collaborative team—attorneys, a neutral financial professional, and when appropriate, a coach or child specialist—can help:
- Build realistic budgets under the new tax rules, focusing on true take-home income and living costs.
- Model alternative support scenarios so both spouses can compare long-term outcomes with clarity.
- Develop innovative solutions such as step-down support, tailored duration, or thoughtful property division adjustments.
Because both spouses are now operating under the same tax rules—no deductions and no taxable income for spousal support—the process becomes more straightforward. The focus shifts from tax optimization to sustainability, fairness, and long-term stability.
Important Note About Existing Orders
Older spousal support orders—especially those executed before January 1, 2019—may still follow the prior tax rules unless they are modified.
For couples revisiting or updating an existing order through collaborative divorce, it’s essential to review the judgment language carefully. Modifying an older order could unintentionally trigger the new SB 711 tax treatment, altering both parties’ expectations.
Learn More at a Free Divorce Options Workshop
The Sacramento Collaborative Divorce Group is committed to helping families navigate change with clarity, respect, and stability. As SB 711 takes effect, collaborative divorce remains a practical and constructive option for couples who want to avoid litigation and design durable financial agreements aligned with both the law and their values.
Ready to learn more?
Attend one of our free Divorce Options® workshops to hear directly from collaborative professionals about how the process works and whether it may be right for you.
View upcoming dates and register here:
sacramentocollaborativedivorce.com/events
Articles and resources from the SCDG team on collaborative divorce, mediation, and family law in Sacramento.