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Divorce can have a wide-ranging impact on your life, including how you do your taxes. No matter if you are the parent paying or receiving child support, you need to understand the state and federal tax laws that pertain to it.
Invictus Law is here to help will all your child support issues. If you have questions about child support and taxes, call now for a consultation, and we’ll get you the answers you need. Our Virginia divorce attorneys are proud to assist clients with a wide range of family law issues, including support settlements and post-divorce modification.
Child support is a court-ordered payment that one parent pays to the other. Its purpose is to cover the child’s daily expenses (i.e., food, shelter, childcare). Parents owe a duty of support to their children. Children are entitled to whatever financial benefits they would have enjoyed had their parents stayed together. Support is awarded based on the combined income of both parents. Also factored in are the costs of health insurance and childcare for the children.
Many people do not understand how child support and alimony affect their taxes. Both typically do have an impact on taxes. For instance, those who receive alimony need to report such payments as income. Child support generally has less of an effect on taxes than alimony. The payer still has to report the income, and the recipient of the support does not include the amount in taxable income.
The Internal Revenue Service (IRS) does not offer a deduction for parents paying child support. Furthermore, the custodial parent (the parent who has sole custody of the child or the parent the child lives with most of the time) does not have to claim the payments as income.
When reporting your income to the IRS, you cannot deduct what you paid for child support. However, if you paid for the child’s healthcare, childcare, and educational costs, you may be able to deduct these expenses. Note that these deductions are only available to families that meet a certain financial threshold.
Couples with joint custody often work out agreements to change which person gets to claim the children on their taxes on different years. If the parents do not have an agreement, and there’s no court order involving tax dependency, the custodial parent designated by the IRS is typically the one who can claim the exemption. Speak with an experienced family attorney if you are unsure if you are entitled to claim your child on your taxes.
If you are going through a divorce, make sure you address tax issues before the judge finalizes the court order. If you are claiming a child and are not the custodial parent, you will still need to provide the required forms to the IRS.
If you have questions about what child support means for your taxes, or if you are dealing with any dispute related to child custody in Virginia Beach, contact Invictus Law today. We are ready to provide the experienced legal counsel you need. Our highly skilled and compassionate family attorneys are committed to doing whatever we can to help you navigate the complexities of your child support situation. Call (715) 317-5125 or fill out our contact form now for a confidential consultation.