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Tax consequences of child support

Texas parents who are divorcing may wonder about the income tax consequences of child support. The person who receives the child support is not required to to declare child support as income, nor is it deductible by the payer. Each year, a significant portion of court-ordered child support goes unpaid. In 2013, $22.5 billion out of a total of $32.9 billion owed was paid.

Parents may also wonder how the child tax exemption will work for them once they are divorced. The exemption is not based on who pays child support. Instead, it is based on who the custodial parent is. The custodial parent can waive this right, but it requires a written agreement that is signed by both parties. It is also necessary to fill out the IRS Form 8332 to include with the tax form of the noncustodial parent. It is not possible to split the exemption.

Parents who share joint custody often agree to claim the exemption in alternating years. It may be advisable to have this arrangement written into the parenting agreement.

It is possible to seek legal assistance both to have a child support order enforced and to have it reduced. A person might have a change of material circumstances, such as losing a job, that results in the inability to pay the agreed amount. However, they cannot cease paying that amount until the court has issued a modification of the order. Similarly, there are mechanisms in place to pressure parents who are not paying child support. This may include garnishing the wages and tax refunds of the parent who is supposed to pay.

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Bruce Turner

In addition to his law degree, Bruce Turner has a master's degree in tax law and is Board Certified in Commercial Real Estate Law by the Texas Board of Legal Specialization.

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Bruce Turner with Bennett, Weston LaJone & Turner, P.C.

Attorney Bruce Turner is located in Dallas and represents people and businesses throughout DFW and the Metroplex, including Denton, Carrollton, Lewisville, Flower Mound, Farmers Branch, Irving, Las Colinas, Corinth, Highland Village, The Colony, Plano, Frisco, Allen, McKinney, Mesquite, Grand Prairie, Garland and Grapevine as well as Collin County, Denton County and Dallas County in Texas.

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