Law Offices of Connie Yi, PC
Tell Us About Your Case
888-312-6978
View Our Practice Areas

How to take advantage of tax deductions for divorced parents

When a California couple divorces, there are a great many changes in their lives. One of them is their annual tax return. Depending upon who has primary physical custody of the child or children, the tax deductions will vary.

For those taxpayers who prepare their own taxes, the first year after a divorce may be a good time to consult with a tax professional. There are several red flags that can trigger an IRS audit, and high-income individuals claiming tax deductions that they are not due, is probably one of them.

So, how do the deductions change? The main change depends upon who is the parent with the most parenting time or physical child custody. There are deductions that only the custodial parent may claim.

  • Head of Household (HOH) filing status is offered to the custodial parent and provides a larger standard deduction compared to filing as a single person.
  • Earned income tax credit can be worth almost $6,000 for a household with three or more qualifying children.
  • The child care tax credit can be worth $600 to $2,100 depending on the number of children and the custodial parent's income.
  • Tax-free childcare assistance provides reimbursements for childcare expenses.

The remaining deductions are available for either parent and include the dependency exemption deduction, child tax credit, higher education tax credits, student loan interest deduction and tuition deduction. The combined effect of these tax deductions and tax credits can be significant.

There is a noncustodial parent rule under which the noncustodial parent can take advantage of the deductions and credits available to the custodial parent. It may be a good idea to consult with a qualified professional for those who want to pursue this option. In the unlikely event of an audit, your representative could discuss any issues with the IRS.

Source: Smart Money, "Child-Related Tax Breaks After Divorce," Bill Bischoff, March 28, 2012

No Comments

Leave a comment
Comment Information

Contact Us

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Email Us For A Response

Office Locations

Law Offices of Connie Yi, PC
323 Ray Street
Pleasanton, CA 94566

Phone: 925-484-0888
Pleasanton Law Office Map

San Mateo
1900 S. Norfolk Street, Suite 350
San Mateo, CA 94403

Phone: 415-433-3350
Map & Directions

San Francisco
490 Post Street, Suite 508
San Francisco, CA 94102

Toll Free: 888-312-6978
Phone: 415-433-3350
San Francisco Law Office

Sunnyvale
1250 Oakmead Pkwy, Suite 210
Sunnyvale, CA 94085

Toll Free: 888-312-6978
Map & Directions