Do I Pay Tax on Child Support in Illinois?

 Posted on April 10, 2014 in Family Law

Child Support is Not Income Taxable

If you receive child support, you do not have to pay income tax on the support received. Child support payments are excluded from your taxable income by both the IRS and the State of Illinois. Even if you receive a lump sum of child support that is past due, or you collect a child support judgment, these monies remain nontaxable to you.

Child Support and Interest

In Illinois, you are entitled to interest at 9 percent on past due child support. For more information on this topic, please see my blog post, "Calculating Interest on Overdue Child Support in Illinois (or Bring Lots of Paper and Pencils)."

Interest on Past Due Child Support is Income Taxable

While you do not have to pay income tax on past due child support itself, if you receive interest on past due child support, that interest is income taxable and it must be reported on your Federal and State of Illinois income tax return. Please refer to Ankhanel v. Commissioner 76 and T.C.M 809 (1998) for more information.

If you have concerns regarding tax on child support and would like legal counsel, or you are interested in filing for child support, contact an experienced Illinois child support attorney to schedule a free consultation. From our Hinsdale office, we serve clients in DuPage, Cook, Kane, Kendall, and Will Counties.