Many people do their own income tax returns every spring, but the year following your divorce it might be a good idea to have a professional complete your tax return for you. While it might seem like your taxes would be simpler to do, there are laws that must be followed after a divorce. The penalties you have to pay if you complete your taxes wrong could be higher than the fee to have someone do them for you.
When your divorce became final effects what tax credits you may be eligible for. In many cases, you and your spouse need to live apart from each other for the last six months of the year. Remember that even if you have been separated for the entire year, you are still legally married until your divorce is finalized and you will have to consider this when choosing a filing status.
In most divorce settlements, it is often assumed that the custodial parent will provide more than half of the child’s needs throughout the year so the custodial parent is usually the one who can claim the child as a dependent. In the case of an amicable divorce, or one in which you and your spouse designed your own settlement, you may choose to allow the non-custodial parent to claim the children on alternate years. You cannot split the exemption, however. Only one of you can claim the children.
Even if you have papers that show you are the one allowed to claim children on your income taxes, you will still need to have a waiver (Form 8332 from the IRS) that is signed by your ex spouse that releases their claim of exemption with the children. Once your children are of age, only the parent they live with can claim them as dependents, until they are old enough to need to file their own taxes. There are rules to older children, though, so be sure to understand those before you attempt to file your income tax return.
Child support is not deductible from your income taxes, but alimony payments may be, if your divorce settlement clearly states that you owe alimony to your former spouse. Some legal fees from your divorce may be deductible, but only in relation to your alimony amounts as that is considered income.
These are only a few of the possible issues you may have with your income taxes the first year after your divorce. A tax attorney or accountant should be contacted for the best information on how your taxes should be done to get you the biggest return or lowest amount owed possible.
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