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Youngster Custody Agreement and Taxes

A kid custody agreement can have critical implications on your tax filing and your taxes general. This concern ought to be addressed with your attorney or with your accountant whilst you are going by means of the method of negotiating or litigating youngster custody or a divorce agreement. Waiting until following you have finalized a youngster custody agreement to investigate the tax impact is not adviseable.

State law on youngster custody does not dictate who gets the tax deductions. If your child custody agreement is completely silent on this issue, the parent with main residential or sole custody will have all of the tax rewards available through the kids. That party will be able to claim the kids as deductions, and so forth. This can be a important problem. There are parents who just assume that if they are paying thousands of dollars per year in help, they will be in a position to take the kids as deductions. Not so. This is incredibly important when you contemplate that all child support payments are not tax deductible to the payor and they are not taxable to the recipient parent.

Thus, when negotiating your kid cusody agreement, you should address the problem of how custody will be structured and who will recieve the tax rewards. This negotiation must be a part of an overall monetary scheme that encompasses a consideration of all problems, including kid custody, child assistance, property, alimony, and tax impact.

The capacity to claim head of household rather of married filing separate or even filing single can be extremely important to your overall tax scheme. You can claim head of household if you have your youngsters for more than 50% of the time. Therefore, a head of household tax filing should be a element of the general negiating outline in a divorce or separation circumstance. A youngster custody agreement that is silent on this issue is truly not a well negotiated or written agreement.

Your child custody agreement can address this concern in a number of ways. If your kid custody agreement supplies for joint shared custody, it ought to state who has the children for 50% of the time. If you have two young children, you can divide that up so that every parent has the possibility of fiing for head of household. If you simply have joint custody and 1 parent has residential custody, you can nevertheless provide a head of household deduction to the other parent by wording the agreement in a way that permits for that filing.

There are other tax advantages accessible to parents that have to be deemed when negotiating a child custody agreement. Several or most of those tax rewards are variable depending upon your revenue level ad no matter whether or not you can claim the child or youngsters as deductions. If you are actually thinking by way of your youngster custody agreement, you will negotiate all of these positive aspects. The objective ought to be to maximize all readily available rewards for both parties, thereby providing an general very advantageous tax impact for your

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