Child support is neither deductible for the paying parent nor taxable income for the custodial parent. But there are tax issues that arise in child support cases that affect both parties.
Key Tax Issues
The dependency exemption and child tax credit belong to the custodial parent in most cases, unless a written agreement or court order transfers them to the paying parent. A paying parent who improperly claims the child without authorization can be reported to the IRS. Child support arrears do not affect these tax issues — but DCSS can intercept tax refunds of paying parents with arrears, which indirectly affects their tax situation.
Coordinating with your tax preparer is important in the year support starts or ends. Changes in support obligations, custody arrangements, and who is claiming the child all affect tax returns for both parents. Custodial parents who communicate their family law situation to their tax preparer avoid errors that create problems with the IRS.
The California Child Support Recovery System gives custodial parents the exact tools and templates to enforce support orders, calculate arrears, and use every enforcement mechanism available. Request your free evaluation here.
California Child Support Recovery System 
Leave a comment