You probably know that your filing status is used in determining whether you must file a return, your standard deduction, and the correct tax. It may also be used in determining whether you can claim certain other deductions and credits. The filing status you can choose depends partly on your marital status on the last day of your tax year.

There are a lot of advantages to marriage. For example, a simplified tax code allows for the filing of a single tax return for both halves of a married couple. The law also provides for more generous tax deductions and exemptions for married couples than for unmarried couples.

Several deductions and credits---the child-care tax credit, education credits or student-loan interest deduction, adoption expenses---are available only to joint filers.

Each dependent child you support provides an exemption when figuring your taxes, and this exemption cannot be split between any two tax returns. Parents who file jointly may both benefit from the exemption for children and elder care, which may impact tax brackets and reduce the tax rate for the joint filing more than it would impact a single return.

Who can claim dependents exemption and what credits are available if parents file separate tax returns?

Generally, because of the residency test, a child of divorced or separated parents is the qualifying child of the custodial parent.

For the purposes of claiming a dependency exemption and the child tax credit, but not for the earned income credit, the child will be treated as the qualifying child of the noncustodial parent if all four of the following statements are true:

1. The parents:
   
   

   a.	are divorced or legally separated under a decree of divorce or separate maintenance,
   b.	are separated under a written separation agreement, or
   c.	lived apart at all times during the last 6 months of the year, whether or not they are or were married;

   
   
   
2. The child received over half of his or her support for the year from the parents;
   
   
3. The child is in the custody of one or both parents for more than half of the year;
   
   
4. The noncustodial parent attaches a Form 8332, or similar statement containing the same information required by the form, to their return. The form must be signed by the custodial parent.
   

If the parents are not married, did not live apart during the last six months of the calendar year, or do not have a written document, the test for determining which parent can claim the child as a dependent is that the parent who provides more than 50% of a child's support during the tax year can claim the child as a dependent.

This doesn't mean that only one parent is entitled to claim the child, just that only one person can legally take the exemption in any given tax year.

The parent claiming the child deduction also receives any child tax credits, head of household filing status or earned income credits due. The parents cannot share or divide the various exemptions or credits.

The child will be considered a dependent for one parent or the other for the tax year. You can negotiate who gets the exemption on a yearly basis or a long-term basis. The exemption may be claimed by one parent one year and the other parent the next tax year. You will want to take into consideration which parent will benefit most of the exemption, which parent earns more in income and other factors. Usually, the parent whose income is in the higher tax bracket will get bigger tax savings.

The right to child support and the responsibilities of parents to provide such support have been internationally recognized.

To meet the definition of child support payments in the United States, the payments must be so designated in a divorce or separation agreement.

Both parents have a legal duty to support their child according to their ability to do so. Most jurisdictions have child support guidelines in effect, which provide a formula for calculating child support based on a proportion of each parent's gross income. These guidelines are applied unless a party can show that application of the guidelines would be unjust and inappropriate in a particular case. 

If you are divorced or separated and pay or receive child support, you should know that child support payments are not tax deductible by the payer and they are not taxable income to the recipient (in other words, child support has no bearings on income taxes.)

The reasoning behind this is that child support is considered a personal expense strictly designated for the benefit of minor children. It is a transfer of money between parents to provide for the child’s needs.

It is also worth mentioning that, whenever there is a taxable event on one side of a giving/receiving equation, there must be an equal off-setting event on the other side of the equation. Therefore, since the child support payment is included in the payer’s taxable income, then it should be excluded from the recipient taxable income.

Alimony or spousal support payments are used to provide the spouse that is making a lower-income with funds to cover expenses that are not provided for through child support or through the division of property. Many factors come into play when determining the amount of alimony that can be awarded. Whereas child support is determined using strict guidelines provided by your state, the judge is often the deciding factor in whether or not alimony will be awarded.

If you are the one paying alimony, you will be able to deduct the payments you make as an adjustment to income. You are not required to itemize deductions to take advantage of this tax break. You will need to file a 1040 individual tax return (not a 1040EZ or 1040NR) and you will be required to provide the social security number for whom the alimony payments were made. 

If you are receiving alimony payments, you will need to report the payments as income and report the social security number of the individual from whom you received the alimony payments from.

Usually alimony is only paid by someone who has made lots of money and can afford it - yet they still get a tax deduction. The tax system is regressive in this way, as lower income taxpayers paying child support cannot deduct their payments, but higher earners can deduct alimony and may be able to use that as a bargaining chip to pay little or no child support.

To determine the amount considered to be alimony and the amount to be considered child support you should consult the divorce decree. If there is no indication at all, the total amount is regarded as alimony.

If the divorce or separation decree stipulates that both child support and alimony be paid, the child support is always paid first. This means that unpaid or late child support is supplemented by previous alimony payments.

As a recipient, you should only claim the payments you have received that exceed the required child support payments as taxable income.

You should be careful how support is characterized in your marital settlement agreement, as it may have significant tax consequences.

To be sure you take full advantage of the deductions that are available to you you should always consult a tax professional or/and a lawyer.