Divorce, children and the new tax law

Tax season is once again in full swing, and there are many questions in light of the new tax law that became fully applicable on January 1. For couples who are considering divorce or separation in Ohio and have young children, one of those questions may be regarding who would get to claim the children as dependents on one's tax return. There are a few factors to consider, and changes to the law that can determine the answer.

The Tax Cuts and Jobs Act, as the law is known, did away with the personal exemption starting in 2018. The personal exemption allowed a person to deduct from his or her adjusted gross income an amount for each dependent a person could claim. While that is no longer the case, the Child Tax Credit has been doubled from $1,000 to $2,000.

When determining which parent gets to take advantage of the tax credit, a couple of different factors may be considered. One factor is based on residence. Typically, the custodial parent, the one the child spends the most time with, will be the one to use the credit. If custody is shared equally, then the nod would go to the parent with the higher income as that parent is presumed to be providing the most financial support.

Tax law is often confusing, and years with significant changes, either in tax law or a family's circumstances, can be even more challenging. A couple who has recently divorced or is contemplating divorce in Ohio may wish to consult with an experienced family law attorney regarding the best way forward. The best interests of the child should always be considered in these cases, and tax implications can figure into that.

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Kemp Law Group, LLC

Kemp Law Group, LLC
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Dublin, OH 43017

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