| |
| |
|
Divorce Information |
|
|
|
Divorce and Uncle Sam: Top 10 Things You Should Know When Filing Your Taxes
1. What is my filing status? (Married, Single, Head of Household) Marital standing at year end determines your filing status for the entire year. If you have a decree of divorce or separate maintenance, signed by a judge, you should file as single. Regardless of whether you have a signed decree you may be able to file as head of household. Filing as head of household may reduce your income tax obligation, but to qualify the following conditions must be met: o You paid more than ˝ the cost of keeping up your home for the tax year, o Your home was the main home for your child for more than ˝ the year, and o Your spouse hasn't been a member of the household for 6 months. If you can't file as single or head of household, then you must either file as married filing joint or married filing separate. 6. Should my spouse and I file as married, filing separate or married, filing joint? Filing joint may provide some tax benefits over filing separate. However, by filing separate the IRS can't hold you responsible for any unpaid taxes caused by your spouse's actions or omissions. The "innocent spouse" rule provides relief from this responsibility in some cases. 2. Is alimony taxable? In general, alimony is taxable to the recipient (line 11 of the 2004 Form 1040) and deductible to the payor (line 34a of the 2004 Form 1040). However, some couples stipulate in their separation agreement that the alimony won't be deductible to the payor, or taxable to the recipient. 3. Is child support taxable? No. Child support is neither taxable to the recipient nor deductible to the payor. If the payor owes both alimony and child support but pays less than the total amount owed, the payments apply first to child support and then to alimony. If the separation agreement doesn't delineate separate alimony and child support payments, general "family support" payments are treated as child support for tax purposes, unless the alimony qualifications are met. 4. Who gets to claim the dependency exemption for the children? In general, as long as the parents combined contribute at least ˝ of the support of the child, the custodial parent gets the dependency exemption for the child. If custody is split or undeterminable, the parent who had physical custody for the greater part of the year gets the dependency exemption. Custodial parents can waive their right to the dependency exemption by filing Form 8332. 5.Who gets to claim the Child Tax credit and the Household and Dependent Care credit. Only the parent who claims the exemption for the child may claim the Child Tax credit for that child. Unlike the exemption, it can't be traded. If you are the custodial parent, you can claim the Household and Dependent Care credit for the child even if you cannot claim the child's exemption. If you are the non-custodial parent, you cannot claim the Household and Dependent Care credit for the child even if you can claim the child's exemption. 7. Are my divorce costs deductible? In general legal fees are considered personal expenses so they aren't deductible. However legal fees paid to get alimony and legal fees regarding the tax effects of divorce are deductible. The attorney must allocate fees paid for deductible and non-deductible services otherwise the deduction may be disallowed. The allowed deduction is a miscellaneous itemized deduction which is deductible only to the extent that, in the aggregate, the miscellaneous deductions exceed 2% of the taxpayer's adjusted gross income. 8. My spouse and I are using the married, filing separate filing status. Can I use the standard deduction if my spouse itemizes? No. If spouses are using the married, filing separate filing status and one spouse itemizes their deductions, the other spouse must itemize as well. 9. Who gets the mortgage interest deduction and other itemized deductions? If the marital home is owned by one spouse alone, only that spouse may claim a mortgage interest deduction. Deductible expenses that are paid out of separate funds, such as medical expenses, are deductible by the spouse who pays them. In general, deductible expenses paid out of joint funds are split 50/50 between the spouses, including mortgage interest. Mortgage interest for property titled by the entireties can be claimed by whichever spouse actually paid the expense. 10. Where can I go for more information about divorce and tax issues? www.rosendivorce.com/taxes Jessie Danninger is a financial analyst with Rosen Divorce. She assist clients in all financial matters relating to divorce, including property distribution, child custody, alimony, and tax related issues. She is a certified divorce financial analyst and CPA. With offices in Raleigh and Charlotte, Rosen Divorce is the largest divorce firm in North Carolina. Founded in 1990, the firm is dedicated to providing individual growth and support to couples seeking divorce by helping them move forward with their lives. Our staff of attorneys, accountants, and specially trained divorce coaches expertly address the complex issues of ending a marriage. Our innovative approach acknowledges that divorce is so much more than just a legal matter. Specialties include child custody, alimony, property distribution, separation agreements, and domestic violence relief. For more information on Rosen Divorce, or for an interview, please contact: Alison Kramer, Director of Public Relations, Office: 919-256-1542, Cell: 919-523-7104 akramer@rosen.com *** ROSEN DIVORCE 4101 Lake Boone Trail, Suite 500 Raleigh, NC 27607 http://www.rosendivorce.com "Divorce is Different Here"
MORE RESOURCES:
Google News |
|
|
|
RELATED ARTICLES
Extramarital Affair: Should You Get A Divorce Just Because One Of You Had An Extramarital Affair? Having to deal with an extramarital affair can be a life-changing event, regardless of whether you stay married or not. Inescapable feelings can come over both people who live through an extramarital affair that will never be forgotten by either of them. Reasons You Arent Starting the Decision Making Process About Whether To Get a Divorce Or... Stay MarriedAlong with any tough decision comes reluctance, especially when that decision involves an actual process and might potentially involve emotional pain or anguish. Deciding whether or not to get a divorce or stay married can be a frightening time for most people, even if they know deep inside themselves that they have to actually make a decision, one way or another. Advantages to Doing Your Own Divorce There are many advantages to doing your own divorce. Three significant ones are: you'll get a better divorce, you'll save a lot of money, and you'll be able to keep things simple. Is Your Marriage Problem Severe Enough To Warrant Getting A Divorce? Having a marriage problem can be agonizing especially if you're trying to do all you can to make your marriage work. Depending on how your marriage was prior to thinking that you had a marriage problem, you could be in for a hurtful time if you don't take a step back and look at your marriage problem from a "helicopter" viewpoint. Cheating Husbands - Meeting Needs? Husbands cheat on their wives for many reasons. They could be bored with their lifestyle and feel that they need to do something exciting or they could be having a midlife crisis. Hire Divorce Lawyer or Use Online Divorce Forms When do you need to hire a family law attorney and when is it okay to just use an online divorce form website to save a little money? This article will provide a few pointers to help you decide whether to do it yourself or retain a divorce lawyer.What Does it Mean to Use an Online Divorce Form Website?Essentially, using an online form website in your divorce case means that you will represent yourself and act as your own lawyer. Divorce and Separation - A Child's Perspective It is always the children that suffer the most when a marriage breaks down and separation or divorce is imminent. Children of divorcing parents often witness arguments even rows and this has a strong effect on any child. Divorce Advice: Getting Divorce Advice From the Right Source Getting the right type of divorce advice depends on what type of divorce advice you want and what you want to use it for. When looking for divorce advice, it is smart to clearly define what you are seeking the advice for so you can be sure to look in the right places. 5 Things To Do Before You Even Think About Getting A Divorce There are many steps to take to protect yourself in a divorce. This article will get you started. Houston Divorce Lawyer - West Houston Attorney Answers Common Questions About Mediation If you are reading this, then you are probably either thinking of filing for divorce -- or have a feeling that your spouse may be filing for divorce -- whether you want to separate or not.One of the common questions that an individual going through the divorce process asks is "What is a Divorce Mediation?"Mediation is a process which allows both you and your spouse to maintain control over your destiny and the terms of your divorce settlement. Things To Consider When Making A Decision About Divorce When making a divorce decision, there are quite a few things that you should consider. Too often people find themselves unable to clearly identify what they need to think about when making a divorce decision which leads to further indecision and frustration. How Can Collaborative Law Be Beneficial In Your Texas Divorce? Collaborative law is based on the realization that the commitment by the parties in a family is that it is in their best interest to avoid going to trial.This process relies on open and honest communication and cooperation between the parties and their lawyers to achieve a fair result. Divorce Makes Us Stronger My friends call me the "Divorce Poster Child".At the age of 20 I was married, and by 22 I had our first child. Grieving the End of Your Marriage, as You Know it The pain of finding out that your partner is cheating on you can be the worst pain you'll feel in your entire life. What is happening to you, you may wonder. Steps Toward Divorce When you're faced with the possibility of divorce it's important that you make sure you and your children (if you have any) are taken care of. Before you even visit the attorney you'll want to assess your financial situation. Divorce--The Five Obstacles to Agreement This article and my articles "Overcoming Obstacles to Agreement" and "Negotiating Agreement" are about how to deal with disagreement--from simple difference of opinion to active upset and anger--and some specific steps that will help you reach an agreement. As you will see, the things you can do yourself are far more effective than anything a lawyer can do for you. How to Use a Divorce Lawyer You want three things in your divorce attorney: expertise in divorce, reliability, and a good attitude. You want a lawyer who specializes in divorce (at least 50% of his/her case load), and unless you're expecting a no-holds-barred battle, you want a lawyer trained in divorce mediation who practices it professionally. How To Protect Your Life Insurance Policy While Going Through A Divorce Life insurance, more than most things you buy, relates to the circumstances of your life. You buy life insurance to protect your family from financial loss stemming from your death. Divorce--How to Beat the System Of course you want to get your Judgment--that's the goal of your legal divorce--but you don't want to go through the adversarial legal system to get it. You don't want to get all tangled up with lawyers and courts, because the system is designed to work against you. Surviving Life After Divorce After divorce, the most important thing you can do is to move forward sensibly. Here are ten steps to help you on your way back to a fulfilling life.
|
| Article List | Index | Site Map |
|
All logos, trademarks and articles on this site are property and copyright of their respective owner(s).
The comments are property of their posters, all the rest is Copyright © 2006 CanadaSEEK.com - All Rights Reserved. |
