Skip to content

How child support is taxed in Illinois

On behalf of Janet Boyle of Boyle Feinberg Sharma (BFS) posted in Child Support on Wednesday, February 24, 2016.

Parents in Illinois and throughout the country do not always receive the total amount of child support that they are supposed to. In 2013, $32.9 billion was owed around the U.S., but only $22.5 billion was paid, according to census data.

Both parents cannot claim the child as a dependent on their taxes. Which parent has the right to claim the child is not based on who provides the most financially for the child but on which parent the child lives with. It is possible for a custodial parent to waive this right, but they must do so in writing. It is also necessary to sign the IRS Form 8332 along with the other parent.

Parents who share custody cannot split the exemption. They can include in their parenting agreement an arrangement to alternate years in claiming the exemption. Child support income is not taxable to the person who is receiving it. In addition, the payer cannot deduct it.

Parents may be happier with the long-term outcomes if they work together to come to a cooperative solution regarding child custody and support. Since they will be co-parenting long after the divorce ends, if they can approach their initial decisions about custody in a collaborative spirit, they may find that cooperation comes more naturally after the divorce as well. However, in some cases, litigation is necessary. This may also be the case with child support. While there is a formula to help determine child support, courts may also take other factors into account such as the overall expenses of the child and the standard of living the child is accustomed to. Parents can return to court to have child support orders modified or enforced.