Should you’re submitting your taxes and have paid or obtained youngster assist within the final yr, you doubtless have some questions. Is youngster assist taxable? Are you able to declare it in your tax return? Does it have an effect on your tax refund or eligibility for tax credit?
On this information, we’ll stroll you thru the ins and outs of kid assist tax regulation, how the Tax Cuts and Jobs Act (TCJA) impacts each dad and mom, and what tax advantages you may nonetheless be eligible for. We’ll break it down clearly for each dad and mom, protecting present tax legal guidelines, how they’ve modified, and the tax implications of kid assist.
What’s youngster assist?
Youngster assist is a court-ordered monetary cost one father or mother (typically the non-custodial parent) makes to the opposite to assist cowl the prices of elevating a toddler. These funds might go towards fundamental wants like meals, housing, schooling, and childcare.
Whether or not you’re paying or receiving youngster assist, it’s vital to grasp how these funds have an effect on your taxes (or don’t).
Youngster assist tax regulation
Is youngster assist taxable earnings?
For folks receiving youngster assist: No, youngster assist just isn’t thought-about taxable earnings by the IRS. Should you obtain youngster assist funds, you don’t report them in your federal earnings tax return, and they don’t rely towards your gross earnings for tax functions.
Is youngster assist tax-deductible?
For folks paying youngster assist: Youngster assist funds will not be deductible. Which means you can not declare youngster assist as a tax deduction in your federal tax return.
New youngster assist tax legal guidelines 2025 taxes
Excellent news! There are at the moment no adjustments to youngster assist tax regulation for the tax yr 2025.
Did the Tax Cuts and Jobs Act have an effect on youngster assist tax regulation?
No, the present youngster assist tax regulation follows IRS tips which were in place for many years — it didn’t change underneath the Tax Cuts and Jobs Act (TCJA) of 2017.
What did the Tax Cuts and Jobs Act do?
The TCJA primarily affected alimony funds (additionally known as spousal assist), which is usually the place a lot of the confusion with youngster assist comes from. Previous to the TCJA, alimony funds had been taxable by the recipient and deductible by the payer. Nonetheless, for divorce agreements finalized on or after Jan. 1, 2019, alimony is now not deductible by the payer and now not taxable to the recipient.
How youngster assist can affect your taxes
Should you’re receiving youngster assist:
- No affect on taxable earnings. Youngster assist doesn’t rely as earnings and received’t cut back your eligibility for tax credit just like the Youngster Tax Credit score (CTC) or Earned Earnings Tax Credit score (EITC).
- You should still qualify for tax advantages for those who’re the custodial father or mother, akin to:
Tax Tip: Although youngster assist doesn’t rely towards earnings, your earned earnings nonetheless determines eligibility for tax credit. Make sure to precisely report all related wages or self-employment earnings.
Should you’re paying youngster assist:
- No tax deduction. You may’t deduct youngster assist funds in your tax return, even when the kid assist obligations are required by a courtroom order.
- You might or might not declare the kid as a dependent. Just one father or mother can declare the kid. Sometimes, it’s the custodial father or mother, however a non-custodial father or mother can declare the kid if the custodial father or mother indicators IRS Form 8332, giving them the appropriate.
Tax Tip: Paying youngster assist doesn’t mechanically entitle you to tax advantages just like the Youngster Tax Credit score. The power to assert a toddler is dependent upon custody preparations and IRS guidelines.
Youngster assist taxes: Regularly Requested Questions
Is youngster assist taxable in 2025?
No, youngster assist just isn’t taxable earnings. This is applicable to each federal and state taxes.
Is there a toddler assist tax credit score?
There’s no particular youngster assist tax credit score. Nonetheless, qualifying taxpayers could also be eligible for the Youngster Tax Credit score, which is predicated on earnings and whether or not you may declare the kid as a dependent. Word that youngster assist funds don’t rely in direction of earnings when figuring out eligibility for the Youngster Tax Credit score.
Do I’ve to report youngster assist on my tax return?
Nope! Since youngster assist just isn’t counted as earnings or deductible, you don’t should report it in your earnings tax return.
Can the paying father or mother declare the kid on their taxes?
The father or mother paying youngster assist (usually the non-custodial parent) can solely declare the kid as a dependent if they’ve an settlement with the father or mother who has custody of the kid. This may be completed utilizing Form 8332, typically throughout a divorce settlement or custody settlement. In any other case, the custodial father or mother typically will get the tax advantages that include claiming the kid (e.g., Youngster Tax Credit score, Earned Earnings Tax Credit score).
What occurs if each dad and mom declare the kid?
Just one taxpayer can legally declare a toddler as a dependent in a given tax yr. If each dad and mom attempt to declare the identical youngster on their tax returns, the IRS will doubtless flag each returns for assessment. The IRS makes use of a set of tie-breaker guidelines to find out who can declare the kid. These guidelines usually favor the custodial father or mother (the father or mother the kid lived with most throughout the yr).
In any other case, you might have a signed Kind 8332 or a transparent settlement in your divorce decree that determines who will get to assert the kid. Ensure you are on the identical web page with the kid’s different father or mother — if the problem isn’t resolved, each dad and mom might face delays and doable penalties.
Can I deduct alimony if I additionally pay youngster assist?
Alimony could also be deductible relying in your divorce date. In case your divorce settlement was finalized earlier than Jan. 1, 2019, alimony funds are doubtless deductible. Divorce or separation agreements finalized on or after that date will not be deductible. Youngster assist is rarely deductible.
Does youngster assist have an effect on my tax refund?
It may well, for those who’re behind on funds. State youngster assist companies can intercept federal tax refunds to gather past-due youngster assist. However present funds don’t have an effect on your tax refund calculation!
The underside line
Within the eyes of the IRS, youngster assist is separate out of your tax life. You don’t report it, you don’t deduct it, and it doesn’t include a particular tax credit score. However your tax submitting can nonetheless get sophisticated for those who’re navigating divorce, shared custody, or making an attempt to determine who can declare your youngster as a dependent. In these instances, understanding the kid assist tax regulation and the way it intersects with different IRS guidelines is vital.
Need assistance submitting? TaxAct® makes it simpler to determine the place youngster assist suits into your tax return (trace: often, it doesn’t). We’ll information you thru the tax preparation course of step-by-step.