Alimony affected taxes in the past. Alimony has been a deduction from income when the payor files his/her income tax return. If the payor earned $100,000 in a year and paid $1,000 a month in alimony, his/her taxable income would be $88,000. The $12,000 per year alimony would be added to the recipient's income and he/she would pay taxes on the alimony received.
The Child Tax Credit came into existence with the 2018 Tax Cuts and Jobs Act. Taxes need to be considered when negotiating a divorce when there are children. Previously in divorces, parties considered who would claim the children as dependents on an income tax return. The Rhode Island Child Support Guidelines suggests that the custodial parent would claim the exemption.