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| 11271 Ventura Blvd. |
| Suite 473 |
| Studio City, CA 91604 |
| Phone: 877-479-7970 |
| Fax: 888-509-8864 |
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| Warner Center Towers |
| Phone: 877-479-7970 |
| Fax: 888-509-8864 |
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| Watt Plaza |
| Phone: 877-479-7970 |
| Fax: 888-509-8864 |
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| Fashion Island |
| Phone: 877-479-7970 |
| Fax: 888-509-8864 |
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Child Support
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The Effect of Child Support on Your Taxes
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If you pay or receive child support, it can impact your taxes. The Internal Revenue Service (“IRS”) has implemented a system through which one may receive credit in the form of an exemption or a deduction for paying child support. A deduction reduces the child support payee’s taxable income. An exemption reduces the child support payee’s adjusted gross income. Conversely, a child support recipient has another set of rules, laid out by the IRS, to follow.
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The federal government recognizes child support as payments that are designated as such by a divorce or separation agreement. When a payment meets this definition, it is not taxable. However, in preparing one’s taxes, the more important questions may be which parent is entitled to take the dependency exemption?
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The IRS has crafted many rules to determine when a person may claim the dependency exemption. The first rule requires someone to provide more than half of a person’s total support in a calendar year in order to claim a dependency exemption. However, there are other criteria that must be met in order to gain the ability to claim the exemption based upon the payment of support.
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In order to claim the exemption based upon the payment of support: the parents must be: (1) divorced or legally separated under a decree of divorce (this means that the parents had to be married); (2) separated under a written separation agreement; or (3) living apart at all times during the last 6 months of the calendar year. One or both parents must provide more than half of the child’s total support for the year, and one or both parents must have custody of the child for more than half of the calendar year. Finally, the child support must be determined under sole support agreement.
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The IRS allows the custodial parent, the parent with the greater custody time, to be treated as the parent who has provided more than half of the child’s support. This means that the custodial parent will be entitled to claim the dependency exemption for the child if the other above-stated criteria are met.
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Unless the parties otherwise agree, the custodial parent will be entitled to claim the tax exemption for the child if the other dependency criteria are met. The actual number of days the child spends with a parent will determine the definition of custodial parent where custody is split or where legal proceedings make custody status unclear during any tax year. In the event that it is unclear which parent is the custodial parent, then the IRS allows the parents to define the custodial parents by counting the actual days that each parent had custody of the child throughout the year and awarding the term to the parent who had the larger number of days.
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However, if the custodial parent agrees, the noncustodial parent can be deemed the parent who has provided more than half of the child's support for dependency purposes and claim the dependency exemption. However, in order for the noncustodial parent to claim the exemption, they must have: (1) a written declaration from and signed by the custodial parent promising not to claim the child as a dependent; or (2) a signed decree or agreement executed after 1984 that prohibits the custodial parent from claiming the exemption for the tax year; or (3) a signed decree or agreement executed before 1985 that allows the noncustodial parent to claim the exemption along with a statement that at least $600 was paid in child support. (The latter requirement may be bypassed if the pre-1985 agreement contains a modification stating that this provision is not applicable.) Of course, the IRS expects noncustodial parents to attach the appropriate agreements or declarations to their taxes.
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Although the IRS does not allow parents to split the dependency exemption in one year, that does not mean that parents cannot agree to divide the dependency exemption on a yearly basis. It is important to fully understand the tax ramifications of the dependency exemption before signing off on any agreement that limits your ability to claim the exemption.
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Contact us at 877-479-7970, or e-mail us at info@law-thomas.com, for an overview of your rights and abilities with regard to the payment of child support or the dependency exemption.
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Q: How is child support determined?
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A: California has stringent support guidelines which consider many things, including but not limited to the: incomes of the parents, the needs of the child, the relative abilities of the parents to pay support, and each parent\’s custodial percentage. Courts will generally follow the amount suggested by the guidelines unless a reason to depart from them exists.
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Q: Can I get child support if I never married my child's father?
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A: Yes. Both of a child's biological parents owe are required to financially support the child. In the absence of marriage, a genetic/ DNA test may be necessary to prove paternity. However, once paternity has been established, a court will award a support order.
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[More]
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 Federal Office of Child Support Enforcement
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The Child Support Enforcement Program is a joint federal, state and local partnership to ensure that parents provide support to their children.
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American Bar Association Child Support Guidelines Report
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Tables at this site summarize the current child support laws in all 50 states.
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[More]
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