Thursday, December 31, 2009

In California, Is the interest paid to x spouse for arrearages on child support considered taxable income?

I understand child support is not deductable or taxable. However, it seems that this additional income would be considered earned income. I have not been treated well in this whole process, even if she had no tax liability, I would feel somewhat better if I was allowed an interest deduction.In California, Is the interest paid to x spouse for arrearages on child support considered taxable income?
Interest is not earned income under any circumstance.





The interest you paid is not deductible to you or taxable to the recipient as it is considered child support.In California, Is the interest paid to x spouse for arrearages on child support considered taxable income?
Any interest that you pay beyond mortgage, student loan and investment interest is considered ';personal interest'; and as such not deductible.
From what I understood-- you defaulted in child support so you had pay interest on child support arrears to your x spouse.


1. Any allowable interest deduction can be claimed only if you itemize your deductions.


2. Interest on child support arrears is not an allowable deduction.


3. I think that the interest on child support arrears will not be earned income for your x spouse as it is not alimony. It should be treated as child support.
In your case is is unallowable personal interest.

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