Is child support taxable income?

With the April 15 deadline to file taxes looming ever closer, you might be wondering what you need to do about your child support payments. There are many misconceptions about child support and taxes, and it’s always important to consult professionals about these important financial and legal matters in Maryland.

If you are the parent receiving child support payments, you do not need to declare the payments on your taxes. Child support is not considered taxable income. However, it does need to be reported in most other scenarios where a government program or other institution is asking for your income.

For those paying child support, the payments are not deductible. It’s also important not to assume that you are able to legally claim the child as a dependent just because you are making child support payments. While it’s common for the parent paying child support to claim at least one child on his or her taxes, this is something that is determined as part of the custody order, and you must follow the provisions in that order to avoid legal action and possible penalties.

Another important thing to note for those paying child support is that your tax refund may be intercepted if you are behind on child support payments. This is one method the child support enforcement agency uses to ensure that the receiving parent is able to get the funds to which he or she is entitled. Whether or not this method of enforcement is used can depend on a variety of factors including how far behind you are and whether you are currently making payments. If you have questions about this or anything else related to child support, a family law attorney can help.

Source: Findlaw, “Child Support and Taxes Q&A,” accessed March 11, 2016