No one likes to think about tax season, and if you are recently divorced, tax time during the upcoming year may be even more stressful than normal. This is especially true if you are used to having your spouse handle your taxes for you, or if you are accustomed to filing taxes jointly. Further, your tax situation may also be affected by terms of your divorce, such as an alimony arrangement.
If you are recently divorced in Michigan, here are some things that you need to know about filing taxes:
Your Marital Status at the END of the Year Determines How You File
One mistake that newly divorced people make is assuming that because they were married for the majority of the year, they will file as married, not as divorced. However, your marital status at the end of the year is what determines how you file. This means that if you were divorced on December 31, you will file as single; if you were still legally married on December 31, you will file as married, even if you have since divorced.
The Effect of Alimony and Child Support
If you received an alimony award, remember that alimony is considered income for the purpose of taxes, and as such, you must pay taxes on it as a result. Additionally, alimony payments are tax deductible.
Child support, on the other hand, does not need to be reported to the IRS for the purpose of paying taxes, and child support payments are not deductible.
Who Claims the Children for Tax Purposes?
If you are a parent who is used to claiming your children as dependents on your taxes and getting a tax deduction as a result, be sure that you are considered the custodial parent before doing so this year. In order to qualify for the exemption, the child must live with you for more than half of the year.
Property and Taxes
Your divorce may also affect your tax filings when it comes to itemized deductions and interest deductions on mortgage payments. If you have questions about what you are legally allowed to deduct, it is smart to work with a tax professional who can guide you through the process.
Thinking of Divorce? Contact an Attorney Now
The tax implications that you will face are just one of the many things to think about when getting a divorce. If you are filing for divorce in Michigan, be sure to meet with our experienced divorce attorney at the Law Offices of Michael A. Robbins. We will not only help you understand the tax consequences of divorce, but also advocate for you during the divorce process to protect your best interests. Contact us today to schedule your initial consultation at 248-646-7980.