With the holidays quickly approaching, we're reminded that once again it will be time to file our taxes. If you're getting divorced and you think that it'll be final by Dec. 31, then there are a few things that you need to know.
Once you're divorced, there are many tax aspects that are going to be different. For example, if you are officially divorced by Dec. 31, the IRS considers that you were unmarried for the entire year.
As a divorced man or woman, there are two possible filing statuses available to you, which are single or head of household. Since single is self-explanatory, we're going to focus on head of household.
You qualify for "head of household" status if you meet the following: 1) you are not married on Dec. 31, 2) you paid over half the costs of keeping up the home, and 3) a qualifying person lived with you for over six months.
The head of household status is appealing because there are wider tax brackets than there are for singles, so it's worth determining if you can file this way.
Can you and your spouse claim your children as dependents? Unfortunately, no, only one parent is entitled to the dependency exemption for the children.
Usually, it's the custodial parent who gets to use the dependency exemption, however, he or she can relinquish their exemptions if they choose to sign a release on IRS form 8332, Release of Claim to Exemption for Child by Custodial Parent. In that case, the noncustodial parent would attach this form to their returns so they could claim the kids on their taxes.
Who can deduct the home-related expenses?
As far as deducting the home-related expenses, this is usually addressed in the divorce settlement or judgement, but it also has to do with the form of property ownership.
Even after the divorce is final, if the home remains in some form of joint ownership, then each former spouse would be entitled to half the deduction for taxes and interest.
Usually though, the home is transferred to one of the spouses and only one person gets the deductions.
To learn more about filing taxes after a divorce, contact a Pennsylvania no fault divorce lawyer from Cairns Law Offices. We'd be glad to answer your questions in a free consultation!