It is a very common question we receive: “Are support payments tax
deductible? How do support payments affect my taxes?” The simplest
possible answer we can give is, alimony is tax deductible, but child support
is not. Distinguishing and separating the two may be difficult, but our
San Bernardino divorce lawyers are here to help you. At Matthew Sheasby,
Attorney at Law, we are dedicated to making sure you do not make mistakes
when filing your taxes and considering support.
In California, the laws require the recipient of the alimony to report
it as income. When they do this, the payor can take a deduction for the
amount paid. If you are the payor and you want alimony payments to be
deductible, make sure you follow the necessary requirements:
- Payments are made in cash, check, or money order.
- The divorce decree does not label the payment as NOT alimony.
- You and your ex are not considered members of the same household at the
time of payment.
- No liability is present to make payments after your ex’s death.
- Payments are not considered child support.
There are certain payments of which you must be aware that do
not count as alimony. While alimony can be considered payments, such as cash
payments to a third party for residence, medical costs, or other expenses,
things such as property settlements, retirement benefits, and other voluntary
payments are not considered alimony.
Unfortunately, without knowing what is classified as
alimony, many people count all payments made to their ex as deductible. This means
that these individuals are considering excessive amounts of payments as
deductible, and are thus paying less to their taxes. It is very important
to make sure you understand alimony payments and how they are connected
to matters such as paying your taxes. If you are the person receiving
support, you must be aware that this counts as alimony and must be reported
on your taxes.
It’s crucial to understand tax implications and how your divorce
case can be affected. These are complex matters, and the most effective
way to get past them is to hire a skilled attorney to help you. By retaining
legal counsel, you can better understand your situation and know what
is considered deductible.
At James D. Madden & Aruna P. Rodrigo, Family Law Attorneys, we are led by a Board Certified Family
Law Specialist. You can trust that when you hire our firm to help you,
we are completely dedicated to your education, your rights, and your well-being.
We can walk you through the process and explain how you can file taxes
while factoring in alimony payments. If you need help,
contact our firm today for a free case evaluation and learn what our skilled lawyers can do for you.