Child support is considered tax-neutral and isn’t taxed by the IRS.
Here’s everything it’s crucial that you about child support ahead of tax season.
No, theIRS guidelines confirmthat the child support you receive is not taxed as income.
If you pay child support, you cannot claim your payments to get a tax break either.
What about alimony?
The Tax Cuts and Jobs Act of 2017changed the taxability of alimony payments, starting in 2019.
Alimony agreements made prior to 2019 are still tax-deductible and should be reported and claimed.
“If it’s not said, then it automatically converts over to being not taxable anymore.”
How do I report child support payments I received on my tax return?
Is there a child support deduction?
No, there is not a child support deduction for parents who are paying child support.
You may also be eligible to claim other credits such as the dependent care tax credit.
Who is the custodial parent?
Parents can also take turns claiming the credit.
Lis strongly recommended that parents detail the child tax deduction in the divorce agreement and use Form 8332.
If I owe child support, can the IRS take my tax return?
What else should I know about child support?
Child support is not intended to cover all of a child’s expenses.
“Those things also get shared between parents.”
Another exception might be insuring teen drivers.
“If you have one teen driver, your insurance policy practically triples,” Lis said.
