Are you considering getting a divorce? Most people who are getting a divorce will think about child custody or support, a division of assets, or who will get the house. What they may not consider is how a divorce will impact their taxes. Both a divorce and a separation will require a change in how taxes are completed. There are different strategies available when a couple is separated or divorced. In order to avoid legal consequences, it is important to contact a tax attorney during or before a divorce or separation.
Consider the Tax Issues
During a divorce or separation, ex-spouses may make financial arrangements but they should always consider the tax issues. If there are children from the marriage, the court will typically decide which parent can claim exemptions for child dependency. Also, spousal maintenance payments are tax deductible while child support payments are not.
During a divorce, property division can also raise tax considerations. There are different tax considerations if a couple sells their marital residence and how the proceeds from this sale are invested. Tax laws can also impact how retirement funds are distributed.
According to the IRS, a couple’s marital status on the last day of the year will determine their tax filing status. If a couple is still technically married, they may find it more advantageous to file jointly. If a couple is legally divorced on the last day of the tax year, they must file as head of household or single.
There are more tax advantages to filing as head of household. This is the proper filing status if the spouses have not lived together in the last six months. Also, if the individual’s home was the primary home for children or qualifying relatives as dependents. There are several other reasons to file as head of household. It is best to confer with a qualified tax attorney when you are getting a divorce.
Visit deanhineslawyer.com | Columbus Ohio if you are in need of professional taxation advice from expert lawyers.
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