How Are Alimony and Child Support Payments Treated by the IRS?
As tax time approaches, you may be wondering how to treat income you get after a divorce. The truth is that although alimony and child support are both paid to help financially support people who have been affected by divorce, they are treated differently by the IRS. Before you file your taxes, make sure you have an idea of whether this type of income needs to be claimed or can be deducted.
Taxes and Alimony
If you receive alimony, you typically need to claim it on your
taxes. There is even a special area for this when you are filling out tax forms. The only time you do not have to claim alimony is when you are specifically told by a legal or tax professional that it is nontaxable, which is a rare event.
If you have been paying alimony to your former spouse, you can usually deduct it on your taxes. However, you need to make sure you include your former spouse's social security number as you fill out your tax forms. Otherwise, you will not get the deduction.
Keep in mind that if you are giving your ex alimony without involving legal documents or the court, you cannot deduct it. This is because there is no proof of the payments. Similarly, your ex will not have to claim it on taxes if this is the case. Therefore, if you want a deduction, you should speak to a divorce lawyer to make sure the legal documents you need are in place.
Taxes and Child Support
On the other hand, child support does not need to be claimed on taxes. The only exception when it may need to be claimed is when you get more than you are supposed to according to court documents. If your former spouse offers more money than he or she has to, you are typically expected to claim the extra.
If you pay child support, know that there is no deduction for it, so you cannot benefit from your payments at tax time. In addition, if you have been ordered to pay both alimony and child support, you can only deduct alimony once you have paid the total amount for child support. So if you are behind on this payment, the alimony you pay will be considered child support until you are all paid up, in which case you cannot deduct the amount on your taxes.
Get a Lawyer's Help
You don't necessarily need a tax lawyer in order to claim or deduct payments, but you may need a divorce lawyer's help to make sure the legal documents are in place. If not, you may be paying more than you should when it comes to tax time. This is where a qualified New York divorce attorney comes in, so call the Law Offices of Brian D. Perskin to make sure you are getting the most from the child support or alimony that you either pay or receive.