People experience many changes in their lives over the years. A change in marital status can sometimes be the one with the biggest impact on a California resident’s life. When a couple decide to divorce it can have an effect on the tax returns of both parties for many years to come.
Whatever date the divorce becomes final, the IRS will consider an individual to be unmarried for the whole of that tax year. It will also change the tax bracket into which one falls. If a marriage is annulled, this will complicate matters for both parties, as the marriage will be deemed to have never happened. This means that both parties will have to re-file their returns under “single” status for all years that are still open.
When children are involved, the custodial parent is usually the one who will be able to claim the dependent exemption. There are circumstances under which this may not be the case, in which instance there will be additional forms to complete as part of one’s return. Child support payments do not count for tax purposes, although spousal support does. In general, there are a number of tax considerations for both individuals to consider.
IRS returns may be the furthest thing from a California resident’s mind when going through divorce proceedings, but with appropriate advice tax filings need not add extra stress to an already difficult time. Seeking such advice in a timely manner may help to avoid problems at a later date. This will help one to move toward a positive future.
Source: madison.com, “Getting Divorced? Here Are 4 Ways Your Taxes Will Change“, Wendy Connick, Sept. 24, 2017