So much about your life will change as a result of your divorce. You and your spouse will separate your personal lives, divide assets and property, share time with the children, and lead separate lives. It is a major decision that will alter life as you know it in numerous ways. It will also impact your taxes. During your marriage, you were able to file an individual return or a married filing separate return, and now that you are dissolving your marriage, you must file individually again. You may even find that you will have to pay higher taxes.
Taxes and Divorce
Divorced spouses are often surprised to discover that they owe more in taxes than they did while they were married. Married couples that file joint tax returns generally pay reduced tax rates, and now that you are single, you may need to withhold more or make certain that key issues related to taxes are addressed in your decree. More importantly, you may have a spouse that owns a business, and the tax consequences of failing to address the commercial tax implications of certain terminology in the decree can cost you thousands if not millions.
Additionally, there are other tax benefits you may miss out on as a result of your divorce. Depending on who is the custodial parent of the children, you may lose the child tax credit. In some cases, parents choose to alternate years, taking turns with who can claim the children on their taxes. This can be difficult to enforce through an order though because of the competing jurisdictions between state level family courts and federal tax courts. You need to have a strong experienced attorney who is aware of the vast tax implications of divorce.
Below are some of the tax credits available for those caring for a dependent:
- The child tax credit
- The earned income tax credit
- The child and dependent care credit
- The other qualifying dependent credit
Whether you can claim these credits will largely depend on who receives custody of the children. If you receive custody of the children, but wish to allow your co-parent to claim these credits, you can sign a written declaration. However, the other qualifications for support and living situation must also be met.
Discuss the Details of Your Case with One of Our Family Law Attorneys!
A divorce can impact your life in a profound number of ways, including your tax obligations. Since this can be a difficult situation to wade your way through, it is crucial to secure skilled legal guidance to help you navigate these troubled waters. At Blanchard & Thomas, PLLC, our experienced family law team has what it takes to get you through this process while protecting your interests. We understand how confusing this experience can be and will help you understand your rights and what you can expect in the future, so you can feel confident in the road ahead.
Get started on your case by reaching out to our law office today at (866) 251-0624 to set up an initial consultation with a knowledgeable member of our family law team.