We all hate paying more income tax than we have to!
Or at least I know I do. When sitting at the table during divorce negotiations, many times the party earning more annually or paying out in child support or spousal support will insist on getting the tax exemptions each year for the children.
BUT STOP & THINK……Don’t be so quick to oblige!
First consider this:
For tax purposes ‘marital status’ is determined on the last day of the year, so a couple is no longer married if they divorce on/before 12/31 and may no longer file a joint tax return.
Neither may file as Married Jointly or Married Separately.
You must now file your own return as either single or if you qualify as Head of Household.
This strategy can be factored into the ‘date’ your divorce being finalized if it is advantageous to both of you to remain ‘married’ for the purpose of one more joint filing year and negotiating how the refund or amount due if any will be split.
Top 9 Questions:
In no particular order
- How do I know if my employer is withholding enough out of my paycheck now that I’m not married?
- Should I change my exemptions at work
- What are the different tax brackets and how does my divorce affect me in this area?
- I agreed to let him claim our son one year and me the next year, what does that look like for me?
- I agreed to let him claim both of the kids since he’s paying me child support and spousal support, what does that look like for me?
- I’m getting spousal support for the next 4 years is that taxable
- I’m receiving child support for the 3 kids, do I need to claim that?
- I agreed to a property settlement offer of $600 week for the next 3 years, how will that affect my taxes
- Will I owe or still get a refund?
There are so many factors to answering those questions
and all need to be addressed
Preferably PRE-DIVORCE because the answers to each of these can leave you bargaining a bit differently based upon the outcome.
Certainly immediately POST-DIVORCE these things must be looked at.
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