John and Mary were divorced in 2011. The divorce decree
provides that John pay alimony of $10,000 per year, to be reduced
by 20% on their child’s 18th birthday. During 2012, John
paid $7,000 directly to Mary and $3,000 to Spring College for
Mary’s tuition. What amount of these payments should be reported
as income in Mary’s 2012 income tax return?