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Income Tax Woes

Published July 22, 2011 - 8 Comments

It had always been my understanding that child support payments were not tax deductible.  At the same time, the parent receiving those payments was required to claim them, but they did not count toward their income.  I’ve been opposed to that concept well before it applied to me personally.  I don’t understand how someone can receive thousands of dollars over the course of a year, yet for that to not be considered “income”… or at the very least the parent who pays that out not be able to claim at least a portion of it, seeing as it’s a considerable portion of their income flowing out.  Now that it affects me personally, I’m even more opposed to it, but alas… I am no tax lawyer.

So I was quite surprised, while filling out my taxes in April, that there was a field in the program to enter child support payments made.  I don’t remember seeing that before.  If it was there (and chances are, it probably was) I certainly never filled it in.  But I decided “what the hell… what’s the worst they can do, deny it?” so I filled it in.  I tallied up all the payments that I’ve made to my ex over 2010.  We have an agreement that is non-court ordered.  Just something that we decided when we split, based closely on the formula the government uses to determine the amount.  I filled in the number:  $10,455.  When I completed the rest of my tax forms, I was equally surprised to see that I was getting a refund!  It’s been awhile since I’ve gotten a refund.  Out of curiosity, I removed that child support figure, and watched my refund turn into an amount owing.  There was a considerable swing from one column to the other!  Hmm…. interesting.

I e-filed my tax return, and began the wait.  It wasn’t too long before I received a letter asking me to justify the amount that I had entered in that child support field.  That really wasn’t a shocker.  It made sense that they were looking for a little more information, than me simply entering a random number in there… and a fairly large one at that.  So I printed out all the statements I had, highlighted the payments I made, wrote up a fancy-sounding “letter of agreement” for me and my ex to sign, found someone to witness it, put the entire thing into a nice package, and dropped it in the mail.. with 2 stamps!

I received my response in the mail yesterday.  An equally large package, containing everything that I had sent them, and a cover letter on top:

We have revised your return based on the information provided.


We have adjusted your claim for an allowable deduction of support payments (line 220) from $10,455.00 to $0.00 for the following reason(s):

  • Child support payments paid under a court order or written agreement dated after April 30, 1997 are not deductible.  Please bend over and take it like a man.

I may have made up that last bit… but SERIOUSLY?!?  C’mon!  Why did you make me jump through hoops to justify that amount if you were just going to deny it anyway?  Evidently, you wanted to know if the agreement was prior to 1997.  (Apparently life was better then)  Had I known that, I would have backdated the damn letter!  Umm… my kids would have been…  very very VERY young in 1997, but hey… had I known how married life was going to turn out, it would have been smarter to have written an agreement in the event that we had children someday… Kind of like a pre-nup!  That didn’t happen.

So guess who owes a considerable tax bill now?  (With interest, I’m sure!)  Go on… take a guess!  The same guy who is not getting a new Macbook Air now.

Oh… almost forgot one thing…

Canada Revenue Agency…  YOU SUCK!