How Does Paying or Receiving Child Support Affect My Tax Return?
Today’s topic deals with taxes and child support. With the tax season upon us I have had a few questions from consultations and from current clients as to how their taxes will be affected by the child support that they are either paying or are receiving.
Is the Child Support I am paying tax deductible?
According to the IRS, child support payments are not considered to be taxable income to the receiving party and they are not deductible by the paying party. The IRS considers child support payments to be a personal expense and since personal expenses are not tax deductible, neither are child support payments.
Do I have to claim the Child Support I am receiving as income?
The receiving party does not have to claim the child support payments as income. If you are the recipient of child support payments, when you are calculating your gross income from the year, do not include tax support payments as income.
Can I still get tax breaks if my ex and I share custody of the child?
You can get a little bit of a tax break if you claim your child as a dependent and also by deducting your child’s medical expenses that you pay for. Some couples split who claims the child as their dependent by each parent claiming them every other year. Others do not alternate and instead have the same parents claim the child as a dependent every year. In either case, you have to be sure that your divorce or your child custody decree clearly specifies this allocation before you can get this tax break. Be sure that when you’re writing your decrees, that it specifies if you are going to be taking the child as a tax dependent for odd years, even years, not at all or every year. Also, if you are paying health care for your child, be certain that this is also included in your decrees so that you are able to get this tax break as well.
If you have questions regarding how your taxes may be affected by your child support or other family law issue, do not hesitate to contact our office to discuss your specific situation at length. Contact our office at (702) 998-1188, firstname.lastname@example.org, or by scheduling a consultation online.