How Divorce Affects Your Taxes
While most Passaic County divorce attorneys will urge you to speak with a financial consultant to get exact figures regarding your divorce settlement and how it affects your taxes, we can answer some of your more general questions regarding divorce and taxes now.
Are my taxes filed jointly or individually during my divorce?
While it makes sense that post-divorce, you would file your taxes separately from your ex, during the divorce process it’s a little more complicated. Tax law allows for individuals who are still married (if you are in the divorce process, but the final divorce papers have yet to be signed, you are still legally married) as of the 31st of December to file jointly for that year’s taxes. So, if your divorce is finalized on March 20th, 2017, when it comes time to do your taxes in April, you still have the option to file for taxes jointly.
If you wish to take advantage of some of the tax benefits of filing jointly, but your spouse does not, you have the option of filing an application with the courts to compel your spouse to file jointly with you. Speak to your Woodland Park divorce attorney for assistance in this matter.
On the other hand, if you have reason to believe your spouse is misfiling their taxes, or not declaring certain taxable sources of income, you probably want to file your taxes separately. If the IRS can prove that you knew your spouse was improperly filing their taxes, you can be held responsible for any penalties and legal ramifications the IRS deems appropriate in the matter.
Alimony Settlements and Taxes Woodland Park, NJ
Another commonly asked question individuals have regarding their divorce and taxes is that of alimony, and how it affects your tax filing. If you are receiving alimony payments, you must declare them to the IRS as a taxable source of income. On the other hand, if you are paying alimony, your payments can be tax-deductible.
In addition, during divorce, a family court judge may order temporary alimony be paid until such time that an alimony agreement can be reached. This is done in order to help maintain “the status quo” of the marriage until such time that the full extent of the couple’s finances can be reviewed and properly divided. This temporary alimony or “interim” alimony is also taxable/tax-deductible.
Clifton, NJ Child Support Agreements and Taxes
While alimony and temporary alimony payments are a taxable/tax-deductible item, child support payments are not. If you are receiving child support payments in order to finance your children’s daily expenses, you do not have to pay taxes on it, and if you are making child support payments you cannot deduct them from your year’s taxes.
Contact a Passaic County NJ Divorce Lawyer Today
Whether you are deciding alimony, child support, child custody, division of assets, or division of business and investment holdings, it is important that you have experienced and knowledgeable family law counsel to protect your rights and fight for the divorce settlement you deserve.
At The Montanari Law Group, our legal team is equipped to address every facet of your divorce. Having assisted clients in Wayne, Little Falls, Woodland Park, and throughout Passaic and Essex counties, we have earned a reputation as skilled and unwavering legal counselors.
When you come to us with your case, our attorneys will meet with you to fully understand your situation, explain the process, answer your questions, and formulate the best strategy for how to proceed. With our knowledge and experience, there is no situation for which you will not be prepared during the divorce process. To discuss your case with one of our seasoned New Jersey divorce attorneys today, contact us online or by phone at 973-233-4396 or toll-free at 888-877-7985 for a free and confidential consultation.