There are many tax issues that can and will be affected by your divorce. You need to be aware of them, how they affect the value of your property distribution, what you should take advantage of to avoid paying more than you have to, and how you will be affected in the years to come. South Carolina divorce attorney J. Darrell Beckham can discuss these topics with you, as they apply to your unique situation. In the meantime, here are three basic tax considerations that come up for those who are considering or are newly divorced.
What’s My Filing Status This Year?
It can feel confusing at first. You were married for part of the year, so how do you file? The answer is simple, although it may not make you happy. For the year during which your divorce occurred, you cannot file a joint tax return, even if you were married for most of that year. Yes, this can mean that your withholdings were all wrong, and it can affect your refund or tax liability. Don’t let this take you by surprise. Do make sure this is part of the equation in your divorce agreements.
Who Gets to Claim the Kids?
Generally, the right to claim a child as a dependent automatically goes to the custodial parent. But, we are talking about taxes, so it gets more complicated. The custodial parent can give that right to the non-custodial parent, but the proper paperwork must be filed. And, to make it even more fun, we’re looking at changes in the law that could allow the courts to decide but won’t remove the need for extra paperwork.
Is Alimony Taxed? Is it Deductible?
This is almost simple. Generally, alimony is taxable income for the recipient, and deductible for the payor. But, again, the two of you can choose to change that up in your divorce agreement.
To learn more about how divorce will affect your taxes and how that plays into your divorce agreements, please call the Law Office of J. Darrell Beckham, LLC, at 800-515-7615 or contact us online to schedule your free consultation. Mr. Beckham is available 24 hours a day, seven days a week.