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Consider taxes while negotiating custody agreements

For Missouri parents who are going through divorce, the sheer volume of decisions that must be made in a constricted timeframe can feel overwhelming. For parents who are negotiating child custody agreements, there are even more decisions to be made. Considering the tax ramifications of a new child custody structure is important, and should be made part of the process.

Many parents assume that the party who receives the bulk of parenting time will also receive the right to claim the child or children as his or her dependents for tax purposes. However, that outcome is not set in stone. Parents are able to negotiate a custody agreement that suits their particular set of needs, including crafting an arrangement that maximizes the tax benefits associated with dependents.

In many cases, one parent will benefit from being able to claim a child as a dependent to a far greater degree than the other parent. In such cases, it may make sense to allow the parent who can maximize the use of dependents the ability to do so. If necessary, other accommodations can be made to make up for any loss of tax benefits to the other party.

It is also possible to structure an agreement in which parents "swap" tax years. For example, the custodial parent could claim the children for one year, while the noncustodial parent can claim them the following year. With proper planning, such a structure could have a significant impact on the tax obligations of both parents.

As with so many aspects of child custody, matters of taxation are an area in which customized custody agreements can yield favorable results. Missouri parents should take the time consider how their tax obligations will change after divorce. In many cases, including tax matters in custody negotiations can help reduce taxes for one or both parents, leaving more money to provide for the care of shared children.

Source:, "5 things women should know about taxes after divorce", Dawn Doebler, March 22, 2017

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