Frequently when people start working on their tax returns at the beginning of a new year, I start seeing questions whether Child Support and Alimony are taxable. Before I provide more information, it should be noted that this information is very general in nature and I am not a tax attorney, so if you have specific questions or your situation is confusing, consult a specialist.
However, the short answer is that Child Support is not taxable to the recipient but Alimony is (taxable to the recipient). If you are receiving Child Support and Alimony, check your “divorce papers.” Your property settlement agreement or court order will likely address these two payments, and help you determine how much income to claim on your tax return for alimony, which is defined as required payments by court order or agreement. If the agreement says that the payments you are receiving are not alimony, even though they may look like alimony, they probably are not alimony.
So if the payments you are receiving are not alimony, then you do not need to claim them as income and your ex-spouse cannot take a deduction for the payments. However, if the amount received is taxable alimony*, then you will need to include that amount on your form 1040 as income. This is why it is important to make sure that the types of payments you receive in a divorce are clearly specified in the court order or agreement.
- Alimony gets treated differently from child support on your tax return.
- Alimony is tax deductible to the person who pays it, and included in the taxable income of the person who receives it.
- Child support, by contrast, is not taxable to the person who receives it and is not tax deductible to the person who pays it.
* If you and your spouse have dramatically different incomes, there may be some tax advantages to using alimony, even if a judge wouldn’t ordinarily award it.