Common sense would tell us that if two people owe each other money the most effective way to settle things is for one to pay the other the difference between the two amounts.
Well, ‘common’ logic does not extend to Canada Revenue Agency or the Federal Tax Court.
A recent decision requires that parents who enjoy shared parenting of their children must exchange cheques in the amounts of their respective child support obligations if they are to also get federal child credits and be able to claim a child as their dependent.
This will affect many parents whose child support orders require them to exchange only the difference in their child support amounts.
If you enjoy shared parenting of one or more children look at your order so that the government does not take more money out of your pocket than they are entitled to take from you.