Divorcing individuals often have questions about tax their considerations and how they are affected by their divorce. While most divorce attorneys will urge you to speak with a financial consultant about your post-divorce finances and obligations, we can look at some of the more frequently asked questions regarding divorce and taxes.
Should I file my taxes jointly or individually during my divorce?
Many people are unsure of how to file their taxes while in the middle of divorce litigation. Tax law allows for individuals still married as of the 31st of December to file jointly for that year’s taxes. So for example, if your divorce is finalized in February, 2017, you can still file for taxes jointly in April. It is important to note that the determination is the date of your divorce being finalized, and not the date when the divorce was initially filed for.
If you wish to take advantage of the tax benefits a joint return offers, but your spouse does not wish to, you can file an application with the court to compel your spouse to file jointly with you.
If, however you believe your spouse to be misfiling their taxes or not declaring certain sources of income, you may wish to file separately so that you do not bear the responsibility of an illegally filed tax return. If the IRS can prove that you knew of your spouse’s improper manipulation of tax information, and still filed jointly with them, you can be held responsible for any penalties and legal ramifications the IRS deems appropriate.
How does my Morris County Alimony settlement affect my taxes?
If you are receiving alimony as a result of your divorce settlement, the IRS will consider this a taxable source of income. You must declare to the IRS that you are receiving alimony, and how much you are receiving. If, on the other hand, you are a payor of alimony, these payments can be tax deductible.
Additionally, during some divorces a judge may order “interim” or temporary support to be paid during the litigation process. This order is intended to help individuals maintain the “status quo” during the divorce process until the full extent of a couple’s finances can be determined and allocated properly. Interim support is also taxable / tax deductible.
How does my Morris County Child Support settlement affect my taxes?
While alimony payments are considered a taxable source of income to the receiver of the payments, and a tax deductible payment made by the payor, child support payments are not.
Contact a Morris County NJ Divorce Lawyer Today
Whether it be deciding your child custody arrangement, child support and alimony settlements, or distribution of property, the Morristown law firm of Townsend, Tomaio & Newmark can help. Practicing exclusively family law, we have the expertise and experience needed to negotiate the many intricacies of any divorce settlement.
To speak with one of our divorce lawyers today, contact us online or through our Morristown offices at 973-828-0829.