How are My Taxes Affected by Divorce
If you are going through or have recently gone through a divorce, chances are you have a lot on your mind. Whether it’s dividing up assets or simply adjusting to your new life, there’s a lot to think about. One important consideration that can easily be overlooked, though, is the question of how are your taxes affected by divorce. From changing your filing status to altering your withholding, there are a number of important things you’ll need to address, but by working with an experienced divorce attorney, you’ll be able to easily take care of these changes.
Important Considerations When It Comes to Taxes Affected by Divorce
- Filing Status. When you get divorced, your filing status will automatically change, whether you filed jointly with your ex-spouse or separately. Your filing status is based on your marital state on the final day of the year for which you are filing. If you were divorced by the end of the year and you have custody of your children, you may qualify for the more favorable status of head of household. If not, your filing status will be “single.”
- Dependents. If, when you were married, you filed jointly, then you and your ex-spouse both claimed your children as dependents. Once you divorce, though, only the spouse that has a greater share of custody of the children will list them as dependents. If custody is split 50-50, you and your former spouse will have to decide who will list your children as dependents. Once you decide, you’ll need to update your withholding on your W-4 form to reflect the change and ensure that your financials are in order.
- Alimony and Child Support. If alimony or child support are part of your divorce agreement, then you need to understand the tax implications of the arrangement. Typically, child support and alimony are not tax deductible unless the divorce was final by the end of 2018 in which case the payer can deduct alimony payments and the recipient must list them on their tax returns. If child support was paid as part of a “family support” combined payment prior to 2019, then it too is eligible to be deducted by the payer and is considered taxable income of the recipient. If you’ve gotten divorced since the end of 2018, you have to be aware that your alimony and child support payments are neither tax deductible nor subject to taxation.
When it comes to the question of how are taxes affected by divorce, the implications can be far reaching for you and your family. Speaking with a divorce lawyer about these issues can help you get your financials in order and be ready for tax season.
Contact a Family Lawyer Today
At Lazor Rantas, we have many years of experience helping our clients with all aspects of their divorce process. Gives us a call today at 973-457-8844 or fill out the form below to get started.
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