Have you spoken to your attorney about your Maryland and federal tax returns to know how to handle child support? There are considerations that could result in thousands of dollars of deductions.
Besides just the exemptions for the children, there are other potentially valuable deductions and credits for children. For example, are you entitled to the child care deduction, are you eligible for head of household filing or will the filing status impact the earned income tax credit? Those are questions you need to consider.
Unlike what many people think, the payments are not tax deductible. Neither are they income to the custodial parent. The exemptions and deductions do not necessarily depend upon who has custody of the children and do not necessarily depend upon who is paying what for a child.
You should also be aware that under Maryland law, your income is one item that is used to calculate the support obligation for your family. If you have mostly earnings for W-2 wages, there is nothing complex about the calculation. But, if you are self-employed, there are many things that could have an impact on your bottom line figure. The definition of gross income includes how the law treats various business expenses and whether the expenses are included or excluded from your income. A family law attorney in Annapolis, Maryland can help you determine what part of your taxable income could be used to calculate the Maryland child support guidelines.