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Divorce Settlement, Child Support And Taxes

When a couple divorces in New Jersey and there are children involved, the custody of the children can be a hard-fought affair with the decision as to which spouse the child or children will live with as well as visitation rights being in question. In addition to the custody, other issues that must be settled are alimony and child support.

Many people are relieved when they finally have reached a settlement on their divorce, the amount of alimony and child support have been determined, and they believe they can move on with their lives. There are other questions that they might not have considered such as whether or not child support is subject to taxation.

How Are Tax Returns Filed Post-Divorce?

tax form

Once the divorce settlement is completed, the spouse who is receiving alimony will know what type of alimony they are receiving. There are several different kinds including temporary alimony (also known as pendente lite), limited duration alimony, open durational alimony, rehabilitative alimony, and reimbursement alimony.

Temporary alimony is awarded during the divorce. Once the divorce is completed, this alimony will cease. Limited duration alimony is awarded for a finite period that could last for months or years. Open durational is only available to those individuals who have been married in excess of twenty years. Open durational alimony can last until the paying spouse retires or his or her circumstances change. Rehabilitative alimony provides money for the spouse who will be supported until he or she is able to reintegrate into the workforce and become self-sufficient. Reimbursement alimony is designed to pay back a spouse who contributed significantly to the supporting spouse's career or education.

Following the divorce, it is required that the ex-spouses file separate tax returns. If you are paying alimony to a former spouse, there are criteria that must be met in order to claim the alimony as a deduction: the couple must not file a joint tax return; the payments are made in cash (including checks, money orders and wire transfers); the divorce agreement does not state that the payments are not alimony; the spouses are not members of the same household post-divorce; there is no liability to make payments in the event of the former spouse dying; and the payment is not treated as child support. Alimony payments received are taxable for the recipient and deductible for the payor.

Will The Recipient Have To Pay Taxes On Child Support?

gavel on book

When there is a child in the relationship and one former spouse is paying child support with the other receiving it, the paying spouse cannot deduct it and the recipient does not have to pay taxes on it. For the payment to remain non-taxable, it must be noted in the divorce settlement that it is child support.

When filing taxes, the child can be claimed as an exemption if the person filing provides more than half of the child's annual support. To conclude who gets the exemption, the couple must be legally divorced and living separately. The parent who is considered the “custodial parent,” meaning that this is the parent who is living with and taking care of the child, can receive the tax exemption. However, often subsequent to the divorce, the parties alternate claiming the child as an exemption. This is true even if the spouse paying child support is paying for more than half of the child's upkeep. The parent who is living with and spending the majority of the time among the couple with the child is deemed the custodial parent and therefore does not have to pay taxes on child support.

Contact A Qualified New Jersey Divorce Lawyer

If you or a loved one are in the process of getting a divorce or have already gotten divorced in Monmouth County, Ocean County or any other area in New Jersey and have questions regarding alimony, child support and taxes, contact the qualified attorneys at the Law Firm of Villani & DeLuca, P.C. in Point Pleasant Beach, New Jersey.

A divorce can be a trying time for everyone in a family and this is especially so if there are children involved. With the myriad of things going through the minds of both parties, there will undoubtedly be many questions regarding custody, payments and whether or not certain payments and money received will be subject to tax. Do not move forward without knowing the facts.Contact an experienced attorney from Villani & DeLuca, P.C. and have your questions answered. Not knowing the facts can be costly long-term.


Villani & DeLuca, P.C. can help you. Call 732-965-3404 today to discuss your option with regards to settlement.

Vincent DeLuca, Esq.

As a founding partner at Villani & DeLuca, Vincent DeLuca is one of only a few Certified Matrimonial Law Attorney in Ocean County, New Jersey. Mr. DeLuca has helped many clients navigate the delicate details of their own divorce. Mr. DeLuca is also a trained divorce mediator and collaborative divorce attorney. Call today at (732) 965-3404 to speak to Mr. DeLuca or one of our experienced NJ Divorce Lawyers.

Office Location

703 Richmond Avenue
Rt. 35 South
Point Pleasant Beach, NJ 08742
(732) 965-3404
(732) 892-9053 (fax)

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