Is child support that was paid as a lump sum and then invested with withdrawals being made over several years taxable? What about dividends and interest?

[ThomasM · Accepted solution]

Child support itself is not considered income and is not taxed.  But if the recipient deposited the money into a taxable (non-retirement) account (i.e. a bank or brokerage account), and earned interest or dividend income, then those amounts would be taxable in the year earned.

So the initial lump sum is not taxable income, but any subsequent taxable income earned from it is reportable.