Tax Breaks for Divorced Mothers

The Internal Revenue Code contains special tax provisions for divorced and separated taxpayers. Divorce is an emotionally difficult process for spouses, their family and friends. The economic consequences of divorce can take years to recover from. Although divorce can have many unpleasant financial and emotional consequences, divorcing mothers and fathers can take advantage of several tax breaks.

Filing Status Benefits

Divorced and separated mothers who have primary physical custody of their children can take advantage of special federal tax filing rules. Custodial parents are able to file their taxes using the federal head of household tax filing status if they are responsible for more than 50 percent of the costs of upkeep of their property.

Head of Household Requirements

The Internal Revenue Service allows custodial parents who live with their dependent children for more than half of the tax year to use this special filing status to reduce their tax liabilities. Instead of filing taxes individually, taxpayers who use the head of household filing status receive a larger standard exemption. For example, in 2011, taxpayers who use the head of household filing status receive an $8,500 annual standard deduction. However, taxpayers who file their taxes using the individual filing status receive a $5,800 standard deduction.

Deducting Attorneys' Fees

Divorcing spouses can deduct their divorce attorneys' fees if incurred to obtain tax advice or marital alimony advice. Mothers who pursued alimony awards can deduct the portion of their attorneys' fees spent to pursue alimony payments. Similarly, mothers who defended alimony claims filed by their ex-husbands can deduct the attorney’s fees they incurred to defend paying alimony to their former husbands. To deduct alimony, divorcing spouses must spend more than 7.5 percent of their adjusted gross incomes on divorce attorneys and can only deduct the portion exceeding 7.5 percent. Furthermore, divorcing spouses must itemize their tax deductions to deduct their qualified attorneys' fees.

Tax Consequences of Child Support and Alimony

Divorcing spouses who receive child support are not required to report their payments. Child support is not taxable if paid pursuant to a written divorce or separation agreement or court order. However, although child support is not taxable, alimony is. Mothers who receive alimony must report their payments as taxable income. On the other hand, mothers who pay alimony can deduct their payments to their ex-husbands if paid under a written court order or divorce settlement agreement. Mothers must use IRS Form 1040 to declare alimony income or deduct alimony payments.

Tax Breaks for Child Care Expenses

Parents can receive a tax credit for their qualified child care expenses. Mothers with primary custody are able to write off their child care expenses if they paid qualified care providers to watch their children younger than 13 so they could work, attend school or look for work. Mothers receive a tax credit of up to 35 percent of their child care expenses, limited to $3,000 per child and up to $6,000 for two or more children, annually.

References

• IRS.gov: Publication 529 (2010), Miscellaneous Deductions
• IRS.gov: Publication 501 (2010), Exemptions, Standard Deduction, and Filing Information
• IRS.gov: Publication 504 (2010), Divorced or Separated Individuals
• IRS.gov: Instruction for Form 2441, Child and Dependent Care Expenses
• IRS.gov: Ten Things to Know About the Child and Dependent Care Credit

Resources

• IRS.gov: Publication 17 (2010), Your Federal Income Tax