How Does Divorce Affect Your Tax Filing?

Hudson, NH Divorcee Seeks a Better Understanding

The IRS does not consider a separation when it comes to filing your taxes.  Only if a legal divorce decree occurs during the calendar year will it affect your taxes.  If the divorce is finalized by December 31^st, the IRS will consider you divorced for the entire calendar year for tax purposes.  The biggest change is that you can no longer file your taxes jointly, but must file as single or head of household.  Any children can only be deducted on the taxes of one parent, which is often the custodial parent.

A newly divorced man in Hudson was concerned about how his new marital status would affect his tax filing.  For advice, he contacted the experts at Merrimack Tax Associates.

Changing Your Filing Status and Number of Dependents

The biggest change with filing taxes after a divorce is that you will no longer have a status of either married filing jointly or married filing separately.  You can either file as a single status or as head of household.  To quality as head of household, you must have paid at least half of the cost of keeping a home for the year and have a qualifying dependent live with you for at least half of the year.  There are tax advantages to filing as head of household over a single status.

Any minor children can be claimed as dependents only on the tax filing of one parent.  This is most often the parent that has primary custody, allowing them to take advantage of the child tax credit.

Claiming Alimony and Child Support

If part of the divorce allows for alimony to be paid to one of the individuals, this will need to be reported as income on the recipient’s taxes.  This money will be included in taxable income.  Child support is never tax deductible and is not considered income for the recipient.

The Hudson resident feels more comfortable now with the knowledge of what he can expect from his next tax filing.