Tax season must be upon us, because you can’t go anywhere without hearing a commercial about some tax professional who is great at their job. As soon as January starts to come to a close, tax season seems to be much closer than it really is. But then again, taxes are a tricky topic to tango with, especially if you have gone through a divorce recently.
Marriage ties a couple’s finances so tightly together, divorce requires the jaws of life to extract two finances from one. If there are children involved, the issue of finances and taxes becomes even more difficult to straighten out. Well, with good will in our heart, we have decided to answer a few of the most common tax questions concerning divorce.
How Do I File?
As a spouse, you filed as “married,” either jointly or separately. Now that you are divorced or in the process of divorcing, the matter is slightly more complicated. But with the right information, it’s not rocket science.
A person’s filing status has a deadline of December 31st. If your divorce is finalized before or on December 31st, you file separately as single.
However, you may file as the head of household if:
Is Alimony or Child Support Tax Deductible?
Alimony is tax deductible for the paying spouse if the alimony meets the following requirements:
Child support is not deductible, but there may be deductibles you haven’t thought of. For example, if you are paying child support for a young child, but you are also paying for parts of their healthcare, you may be able to deduct that. For older children, if you are helping out with tuition, enrollment fees, school supplies or more, you may be able to deduct that as well.
Who Claims the Children as Dependents?
Usually, this issue will be agreed upon in the marital settlement agreement, so check those papers first to find the answer to your specific situation. If you and your ex didn’t discuss this in the settlement agreement, then the custodial parent of the children has the right to claim the children as dependents.
If there is a joint custody situation, then the parent who has the child for more than half of the year claims the child as a dependent. If it turns out that both parents have the child for equal amounts of the year, the parent with the higher adjusted gross income claims the child as a dependent.
If you have more questions about how to file your taxes as a new divorcee, here is the IRS’ 504 Publication, which is all about “Divorced or Separated Individuals.” Hopefully these words of tax wisdom will make your tax filing experience just a little bit less stressful. Here’s to a big tax return!