Child Support

Payments that are specifically designated in the decree or agreement as support for minor children are child support and not alimony. These payments are neither deductible by the payer nor taxable to the recipient.

Sometimes amounts not specifically stated in the decree to be child support will nonetheless be treated as child support. This happens when payments are reduced or eliminated upon the occurrence of a contingency relating to the child, or at a time that is clearly associated with the contingency.

Example: Peter Yosores's divorce decree states he will pay his ex-wife $500 per month until their son reaches age 21. Although the divorce decree does not specifically state that the $500 per month is child support, it will be so treated because it will cease upon the contingency of the son's 21st birthday.

When the divorce decree does not set a specific amount for child support, and no child-related contingencies are involved, the entire payment is alimony.

Example: Gary and Gina Villanueva are divorced. Gina has custody of the couple's two children. Their divorce decree states only that Gary will pay Gina $1,500 per month. Because the decree does not stipulate a specific amount as child support, and no child-related contingencies are involved, the entire amount is considered alimony.

When alimony and child support payments are both required by a decree, child support is always considered to be paid first.

Example: A taxpayer is required to make payments of $900 per month until the death or remarriage of his spouse. The decreed designates $600 pf this amount as alimony and $300 as child support. The taxpayer sends only $9,000 in total payments for the year. The alimony deduction for that year is $5,400 because the $3,600 designated as child support by the decree is considered to be paid first.

On occasion, alimony may include the payment of expenses of a personal residence, such as real estate taxes, insurance, interest, and utilities. The facts in each situation determine the amount deductible by one spouse and taxable to the other spouse.