Tax Concerns for Working Nevada Families
When you are counting your every penny to support your family, that typically means every penny matter. But, when it comes to tax time, that can either be a good time of the year because you get a wealthy tax refund, or that could mean a devastating time of the year because you owe Uncle Sam some serious change.
Here are some tax issues for working Nevada families or just some issues that you should know about prior to tax time.
Nevada Income Tax
States unlike Nevada, have personal income tax laws. These personal income tax laws are put in place to help pay for services that include road maintenance and construction, police budgets, and even schools.
Just like federal income tax, the state income tax will be calculated as a percentage of your employment income.
Even some states decided they are going to use a variable tax rate that is dependent on how much money you make.
Nevada Consumer Tax
Besides the personal income tax, the state of Nevada has a pretty complex consumer tax law. The consumer tax law will add an additional surcharge to consumer goods such as alcohol, gasoline, gambling, and even cigarettes.
To be honest, when it comes to consumer tax, Nevada is the 8th highest tax rate in the United States. So even though, residents will not be required to pay personal income tax, they will end up making it up in their consumer tax.
Child Support and Taxes
If you are the one paying child support or if you are the one receiving the child support, there is always a thought in the back of your head if you must pay taxes on it or if it is tax deductible.
To be honest, it is a great question though!
So, we are going to answer all your child support and tax questions you may have today!
In Nevada is Child Support Taxed?
The answer to this question is going to be no. In the state of Nevada, child support is not taxed. The money that you will receive for child support is known as tax-free money. So, if you are the one receiving the child support payments, you can spend it as you see fit. You will not be required to report the money as income on your tax return.
Can I Put Child Support as a Deductible on My Tax Return?
The answer to this question is going to be no. Your child support payments cannot be used as a deductible on your tax return in the state of Nevada. You should know that the money you send to the other party for child support will be taxed on. That is a part of your income, so it will be taxed just like the rest of the income.
Is Alimony Payments Tax Deductible?
The tax rule has changed in 2019. As of the new tax rules in Nevada, alimony payments cannot be deducted from your income on your taxes.
However, this will only go for new divorces that were finalized AFTER January 1, 2019. If your divorce was finalized prior to January 1, 2019, then you can still deduct your alimony payments like normal.