If you have just started paying or receiving child support in Georgia, you might wonder how this obligation affects your tax filing and other aspects of your life. When completing health insurance forms, tax forms, or other legal paperwork, it is vital that you understand what is and is not considered income. 

In this blog post, the legal team at Crystal Wright Law, LLC explains whether child support is considered income in Georgia. Continue reading for further information.

Does Child Support Count as Income When Filing Taxes?

Child support is money that one parent pays to the other parent to offset the costs of parenting. State law recognizes that children have a right to be financially supported by both of their parents, even when their parents are no longer involved with each other romantically. 

According to the Georgia Department of Human Services Division of Child Support Services, child support is ordered based on the Georgia Child Support Guidelines. When determining an amount of support to award, the court considers the following:

  • The income of both parents
  • The number of children
  • The cost of obtaining health insurance for the child 
  • Other relevant factors

Child support is not factored as income for the parent receiving it when filing taxes, according to the Internal Revenue Service. Likewise, child support is not considered a taxable expense for the obliged parent, so you don’t get any tax breaks for child support payments you make.

Guidelines for Child Support, Dependency, and Taxes

When you prepare your taxes, do not include money you received for child support in your income calculation. Otherwise, the government could tax this money. You also do not count child support as income when calculating your Earned Income Credit. Likewise, do not include child support you paid as an expense on your tax return. 

If you are divorced, only you or the other parent can claim your child as a dependent. There may be a statement in your divorce decree that says which parent will claim the child as a dependent for tax purposes. Absent such an agreement or stipulation, the parent who has the child for most of the time usually claims the exemption

However, if one parent provides over 50% of the child’s support, that parent is entitled to the exemption. In that case, that parent would have their ex sign IRS Form 8332 and file it with their taxes. 

Does Spousal Support Count as Income When Filing Taxes?

Spousal support is now treated the same as child support in that it is not considered taxable income for the recipient or a tax-deductible expense for the spouse paying it. The law used to be that the spouse paying spousal support could deduct this expense from their federal income taxes, but this changed with the Tax Cut and Jobs Act

However, divorce agreements that contained this language before December 31, 2018 are still effective under the old rules.

Other Considerations for Child Support as Income

Child support could be counted as income in other ways that might affect your life. For example, when applying for public benefits, you may be required to report child support you pay or receive. The form or application for assistance for food, housing, utilities, medical care, or other help should state whether you need to report this information. 

Be sure you only report the payments you actually receive since reporting more income than you get could make you ineligible for benefits or eligible for less benefits. 

There may be other times when you might want to report child support as income, such as if you are applying for a loan. Disclosing child support payments is usually voluntary in these cases. 

Child support and spousal support laws can evolve over time, so it’s important you understand the current rules. Contact an experienced lawyer to learn more. 

To learn more and get the help you deserve, call our divorce & family law firm at (404) 594-2143 or reach out to Crystal Wright Law online by visiting our contact us page.
You can also visit our law firm at 440 S. Perry Street Suite 105, Lawrenceville, GA 30046.