Will Divorce Affect How I File My Taxes in Illinois?

 Posted on September 11, 2019 in Divorce

A person will likely experience many changes after getting a divorce. One spouse may move to a different city or state to get a fresh start. If children are involved, a parenting plan will be created to allocate parental responsibility and scheduled parenting time, among other things. Also, finances will be affected, since the spouses will no longer be sharing incomes. Another adjustment for a newly single person will be how he or she files taxes at the end of the year. An individual’s tax filing status will be different after a divorce, especially if children are involved. 

Filing Status

Depending on when the divorce is finalized will determine how a couple can file. If the divorce is final before December 31 at 11:59 p.m., each party must file their own individual tax return for that year. However, if the couple remains married at this time, they may choose whether to file taxes jointly or individually. A single person often can only claim one allowance, but a married couple has access to several. 

If taxes cannot or will not be filed as a married couple, then each person has the option to claim as Single or Head of Household. Filing as Head of Household has benefits such as a higher standard deduction, but both spouses cannot the same children as dependents. Other qualifications for filing as Head of Household include:

• Paying half of the cost of living in a home or apartment for the filing year

• Having a qualifying person, such as a dependent, live with him or her for at least half a year

The party who files as head of household will likely be the parent who has the most parental responsibility and/or parenting time for a child. The tax exemption for the child usually goes to this parent. However, it is possible to split tax exemptions with IRS form 8332, which states that a custodial parent is allowing the other parent to claim a child. Parents can also claim a tax credit for each child dependent who is under 17 years old, and there are additional credits for contributing to education and childcare.

Child support is not considered income and therefore does not need to be reported by the recipient, and it cannot be deducted by the payor. It is also important to note that for divorces finalized after January 1, 2019, the federal Tax Cuts and Jobs Act of 2017 (TCJA) eliminated the deduction for spousal maintenance (alimony) payments, and recipients of these payments no longer have to report them as taxable income.

Contact a Barrington Divorce Lawyer

On the list of many things that change after a divorce is how you file your taxes at the end of each year. Speaking to a legal professional can help you understand what to do during and after the legal proceedings. To find out how your tax filing status and finances may change during your divorce, contact a skilled Palatine divorce and family law attorney. At A. Traub & Associates, we have years of experience in all areas of family and divorce law, and we will make sure your rights are protected. Call our office today at 630-426-0196 to schedule an initial consultation.

Sources:

https://www.creditkarma.com/tax/i/filing-taxes-after-divorce/

https://smartasset.com/taxes/filing-taxes-after-divorce