It is tax season, and if you are getting a divorce, you are probably thinking the timing could not have been worse. A divorce is not only emotional, but it comes with its share of financial challenges related to tax considerations. This stressful time may divert focus away from important decisions that could affect the taxes you pay. At the The Law Office of Linda Risinger, we help clients with every aspect of their divorce, including figuring out their tax implications and helping identify potential advantages.
Filing Tax Returns
Marital standing impacts everything from your filing status to whom you can claim as a dependent. If your divorce is not final yet, you may be able to file a joint tax return even if you no longer live together with your spouse. This could be advantageous, because it may make you eligible for a higher standard deduction when you combine your income with your spouse on the same tax return. On the flip side, when you file jointly, you will both be liable for all taxes due, even on income that your spouse earned.
Child Custody and Impact on Tax Obligations
According to the IRS, one parent is allowed to claim a child as a dependent each year. If you have more than one children, you can claim one, the deductions for different children may be divided between you and the other parent. Usually, the parent with primary custody is eligible for exemptions and credits that can reduce their tax liability. In some cases, a parent with a lower income may agree to give up the exemption and allow the parent with a higher income to gain the benefits of claiming the child as a dependent.
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