21 May 1999 External T.I. 9909685 - CHILD SUPPORT PAYMENTS

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues:

We replied to an individual 5-990063 and she wrote back attaching portions of her various court orders and requested that we give an opinion on whether she has received support payments pursuant to a valid agreement.

Position TAKEN:

There was still some missing information, but based on what was provided the support payments were received pursuant to a valid agreement.

Reasons FOR POSITION TAKEN:

The XXXXXXXXXX , Court Order stipulated that the individual would receive support payments on an interim basis pending the hearing of the motion. The XXXXXXXXXX Court Order gave interim custody to the individual and the motion was adjourned to XXXXXXXXXX . We have been verbally informed that the former spouse was not represented at this hearing, hence the motion has not yet been heard and the interim support and custody remain in force.

XXXXXXXXXX 5-990968
D. Miller
May 21, 1999

Dear XXXXXXXXXX:

Re: Child Support Payments

This is in reply to your letter of April 13, 1999, and various telephone conversations (Miller/XXXXXXXXXX) regarding the taxability of the amounts received for child support.

We understand that you have been receiving child support payments pursuant to an interim court order dated XXXXXXXXXX. The Court awarded you interim child support of $XXXXXXXXXX per month per child pending the hearing of the motion. Paragraph 3 of the order states “XXXXXXXXXX”. The Court reconvened on XXXXXXXXXX at which time the Court ordered that there be a summary judgement of divorce, that you have interim custody of the children and that the motion be adjourned to XXXXXXXXXX. Your lawyer informed you that neither your former spouse nor his council appeared on XXXXXXXXXX and were declared in Contempt of Court. You have been unable to obtain any documentation of the XXXXXXXXXX hearing.

Our Comments

Child support payments made pursuant to a Court Order made before May 1997, regardless of whether it is an interim order or not, are generally taxable to the recipient and deductible by the payer. Where the interim court order only requires child support payments to be made for a particular period of time, then any payments made after that time would not be made pursuant to the court order and would generally not be taxable/deductible.

Your interim order states that child support will be paid “on an interim basis pending the hearing of the motion”. From the information provided, both verbally and in writing, this motion was never heard. There is no evidence of a termination date to the interim payments. It is our opinion, based on the evidence available, that the XXXXXXXXXX order with respect to the payments is still valid, and any amounts received pursuant to this order are taxable in your hands.

If you require further assistance, or if any documentation pertaining to the XXXXXXXXXX court hearing has pertinent information, you should contact the XXXXXXXXXX TSO with copies of these documents. We would be glad to assist the TSO should they so request.

Yours truly,

Jim Wilson
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch