Divorce and Taxes Part II – Child Support, Alimony, and Taxes

Divorce and Taxes Part II - Child Support, Alimony, and Taxes

The certainties of death and taxes are inescapable, as is the certainty that divorce will change your tax situation. If you’re getting divorced, you may need to think about child support, alimony, and taxes – along with other tax issues.

In this series, we look at some of the key issues surrounding divorce and taxes so you can gain the clarity you need to have informed conversations with your attorney and your CPA. That can be important to help them protect your interests.

Last time in the series, we discussed four things to consider when mediating or negotiating your divorce decree. When it comes to our topic for this installment — child support, alimony, and taxes — you may find some surprises.

 

Child Support and Taxes

If you receive child support, you don’t have to report it as income.

If you pay child support, you don’t get to deduct it on your taxes… and you don’t get to claim the child on your taxes just because you pay support. The parent who gets to take the dependency exemption for the child depends upon your Divorce Decree, temporary order, and/or the tax code.

 

Alimony and Taxes — A Different Animal

Alimony (spousal support) is altogether different than child support when it comes to tax rules. If you receive alimony, you have to report it on your taxes as income. If you pay alimony, your spousal support payments are tax deductible.

 

Getting Slick with Spousal Support and Taxes — A Sticking Point for the IRS

If your decree structures alimony payments to be high in the first couple of years and then drop off, the IRS may consider those payments to be a property settlement rather than alimony and you may not be able to deduct them.

 

Know Your Decree

Be mindful of child and spousal support tax implications when you’re negotiating or mediating your decree – including who will claim exemptions for the children.

 

A Word About Backsies

If you reach an agreement and a temporary order or final decree is entered, but your spouse changes their mind later, you may want to file your taxes before your spouse. That is unless you need them to sign IRS Form 8332 and they refuse. If that happens, talk to an experienced attorney about enforcement options as soon as you can.

If you don’t need your spouse to sign Form 8332, and they tell you they’re taking the dependency exemption when they aren’t entitled, you may come out ahead if you file first because the IRS will credit the first person who files and claims the exemption.

For more on filing child support and taxes and alimony and taxes, see IRS publication 504.

 

Next in the Series…

Next time in the series we look at things to think about when negotiating the property settlement agreement in your divorce.


This article should not be construed as legal advice. Situations are different and it’s impossible to provide legal advice for every situation without knowing the individual facts. 


Author, Hightower Reff  Partner Attorney Tracy Hightower, holds both a Juris Doctor and  a Master of Laws in Taxation. For more about Tracy, visit her profile page.

If you need help with an Omaha area divorce or other Omaha family law case, contact Hightower Reff Law today and come visit with one of the attorneys at the Omaha office. 

Prepping for Your Divorce Trial: Top 5 Tips (From a Divorce Lawyer)

divorce trial

What You Need to Know About Your Divorce Trial That Your Lawyer May Not Tell You, Part III

Walking into a courtroom for your divorce trial can be daunting, especially if you don’t know what to expect.

In this third and final installment of our series “What You Need to Know About Your Divorce Trial That Your Lawyer May Not Tell You,” Hightower Reff Law partner attorney Tracy Hightower shares her top 5 tips so you can prep for your divorce trial.


In the words of Benjamin Franklin, “By failing to prepare, you are preparing to fail.” At Hightower Reff law, we believe helping our clients prepare for their divorce trial is one of our most important functions as divorce lawyers. Over the years as an Omaha divorce lawyer, I’ve found there are lots of things clients can do to improve their chances of reaching their goals. Now I’m sharing with you my top five tips for prepping for your divorce trial.

 

1. Block your calendar.

Plan to devote the day to your divorce trial, including:

  • Make plans in advance to take time off from work
  • Be proactive — ask your attorney if they need time to meet with you before the trial day to prepare you for your testimony or other things
  • Don’t be surprised if the original trial date gets continued (moved to another day) at the last minute, or if you don’t finish in one day

 

2. Prep for live testimony.

Witnesses for you or for your spouse will testify in person before the judge. You and your spouse will likely testify as well.

  • In “temporary” hearings you may have had during your divorce pre-trial motions, your lawyer probably presented evidence on your behalf by affidavit. That’s a written document, signed under oath. Trials are different.
  • At trial, witnesses testify in person. Affidavits aren’t allowed.

 

3. Your lawyer may not call all the witnesses you want — and that’s okay.

Your lawyer will only call the best witnesses. That almost always means witnesses with firsthand, personal knowledge.

  • In a nutshell, your witness must have firsthand, personal knowledge to testify. They can’t testify about out of court statements of others, or information they got from another person.
  • The most basic first step in determining if a testimony from a witness may be hearsay is to figure out whether the witness was the originator of the information. If not, it’s probably hearsay.
  • For example, your mom can’t testify about your pediatrician’s opinion that your son’s asthma is aggravated during visits to the other parent’s house.
  • There are other things that go into a hearsay determination, and it can get complicated.
  • Tell your attorney about the possible witnesses you believe may have personal knowledge relevant to the issues of your divorce. It’s their job to figure out who’s to testify at trial.

 

4. Dress your best.

The impression you make on the court is important. Appearance and grooming are key.

  • Your lawyer won’t come to court in jeans or a team sweatshirt. They dress to show respect for the court and to present a professional image for their clients and for themselves. If you do the same on trial day, you can’t go wrong.
  • The court will be assessing your credibility and perhaps your fitness as a parent. Making a good first impression by dressing appropriately and respectfully can only help boost your credibility.

 

5.  Control your face.

No matter what unbelievably shocking stupidity comes out of your spouse’s mouth, try to keep a straight face.

  • If you roll your eyes or make weird faces, the judge will see it. Most times, that isn’t a good thing. As hard as it may be, try to keep a neutral face — or at least not look like this (or anything close.)
  • Crying is okay. Divorces are emotional. The judge understands. You can be authentically emotional in court, you just can’t be rude or out of control. If you feel you need a few minutes, let your attorney know.

If you have questions before your divorce trial, don’t be afraid to ask your divorce attorney. They are there to support you through the process.

If you missed Part I of the series, read it here.

Catch up with Part II here.


This article should not be construed as legal advice. Situations are different and it’s impossible to provide legal advice for every situation without knowing the individual facts.


 For More Information:

Learn more about Hightower Reff  Partner Attorney Tracy Hightower.

Find out more about Hightower Reff’s family law services.

If you need help with a Nebraska divorce or other family law case, contact Hightower Reff Law today and come visit with one of the attorneys at the Omaha office.