While your marriage is dissolving, filing taxes is probably the last thing on your mind, but ignoring these state and federal requirements may lead to a different kind of heartache down the road. This guide is not meant for married couples that are in love limbo; this is for pairs who are intent on parting ways. If your divorce is not finalized by December 31st, you need to decide how you want to file. Here are the three most common filings for still married and legally separated couples to find the best option for you.
Before the ink on your divorce papers is dry, you may want to consider filing one last joint return together. Typically, filing a joint return is the most cost-effective option but it does come with some risks because it also means that you share responsibility for potential tax dues and any related penalties. If you’re not on speaking terms with your estranged spouse or have an inkling they may skip out on the expenses, do not jeopardize your credit with a joint return.
Married Filing Separately
If you’re looking to limit your liability this tax season, filing separately is your safest bet. Under this option you will gain the piece of mind that you’re not responsible for your spouse but you will also forfeit certain incentives including the ability to claim earned income, higher education tax breaks, and some deductions.
Legally Separated Options
If you have gone through the courts and legally separated from your spouse, then you may file as “single” or “head of household.” The process to file single is straightforward and ideal for legally separated couples that never had children. However, if you have a dependent living with you the majority of the time and pay at least half of the expenses needed to maintain a home, then you may qualify for head of household status. Regardless, only one parent may claim a child as an exemption under Box 6a on the 1040 form.
At Heritage Law, LLP we have a team of experts in both divorce and tax law. Unlike firms that only specialize in one area, our attorneys combine their collective knowledge to provide you with the best outcome possible. Contact us for a consultation.