Divorce can be a very challenging period in your life. Which spouse owes tax? What forms and returns need to be filed? When do I need to file? How do I file? What is the best tax planning strategy for my divorce?
Tax Filing status
A taxpayer is considered to be unmarried at the end of a tax year if his spouse is legally separated from the taxpayer under a decree of divorce or separate maintenance contract at the close of the tax year.
A married taxpayer will be considered unmarried and eligible for head of household status if the taxpayer's spouse was not a member of the household for the last six months of the year and the household is the home of a dependent child.
Liability on Joint Return
You may request relief from liability for tax, plus related penalties and interests for which you believe that your spouse (or former spouse) should be liable.
Innocent Spouse Relief is available if you: (1) filed a joint return and (2) are no longer married to, or are legally separated from the spouse with whom the joint return was filed.
Dependency Exemptions
In general, the dependency exemption for children of divorced taxpayers will go to the parent who has custody of the child for the greater part of the calendar year.
Alimony
In general, alimony and separate maintenance payments are income to the recipient and are deductible by the payer. Different rules apply to payments made under post-1984 divorce or separation instruments and payments made under pre-1985 instruments.
Child Support Payments
Fixed payments for child support are not deductible for tax purposes. If the amount paid is reduced contingent to the child - such as attaining a specified age, dying, leaving school, or marrying - the amount of the specified reduction is treated as child support.
If you have specific questions concerning the tax implications of a divorce, AllLaw.com recommends that you seek a licensed tax expert to assist you.
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