Child support payments are not tax deductible by the payer and are not taxable income to the recipient. Paying child support does not necessarily entitle you to claim the child as a dependent for tax purposes (a dependency exemption). The Internal Revenue Service (IRS) rules dictate that the parent with whom the child spent the most nights during the tax year has the right to claim the child as a dependent. And if the child spends an equal number of nights with each parent during the tax year, the parent with the higher adjusted gross income (AGI) has the right to claim the child as a dependent. Sometimes the child custody court will order the parents to alternate years of claiming the child as a dependent.

In Illinois, as in all states, child support payments are not tax deductible for the payer and do not count as taxable income for the recipient. This aligns with federal tax law, which is governed by the Internal Revenue Service (IRS). When it comes to claiming a child as a dependent for tax purposes, the IRS rules stipulate that the custodial parent, defined as the parent with whom the child spent the majority of nights during the tax year, is typically entitled to the dependency exemption. If the child spends an equal amount of time with both parents, then the parent with the higher adjusted gross income (AGI) is generally given the right to claim the child as a dependent. However, Illinois courts can order parents to alternate the years they claim the child on their taxes, regardless of where the child spent more nights. This is often outlined in the custody agreement or divorce decree.