Tax Filing During a Divorce: Separate or Joint Returns?
Divorce Attorney
by Vanessa Soto Nellis
818.907.3274
Couples going through a divorce should remember this regarding taxes: You can still file a joint return, so long as you were still married as of December 31st.
Even if you separated from your spouse and moved out of the house on January 1, 2014 – if you did not receive a divorce decree by December 31st, you’re still considered married in the eyes of the Internal Revenue Service.
The IRS considers same-sex couples married, if the couple was married in a state where same-sex marriages are legal. So here in California, no distinctions are made in terms of whether a heterosexual or same-sex couple is considered married or divorced – all follow the same rules.
For most couples, filing jointly will result in more tax savings. If your divorce finalized before December 31st, you’ll have to file singly, or as head of household – the latter could garner you more tax savings if filing that way. Talk to your accountant to figure out what’s best for your situation.
Speaking of accountants, the IRS allows you to deduct some of the fees paid for expert advice regarding tax planning and obtaining or collecting spousal support. Thus, you may want an itemized statement from your attorney.
Separated & Filing Taxes
No matter what the relationship status, couples should always communicate. That holds especially true for separating couples at tax time. Consider these questions:
- Are you Married, Filing Jointly; or Married, Filing Singly?
- Which of you is the custodial parent?
- Who claims the children as dependent exemptions?
- Will one of you file as head of household, while the other claims the dependent exemptions?
If you are legally separated in California, claiming head of household means you have dependents and pay for at least half of the costs of maintaining a home. So if your child(ren) live with your spouse in a home that you mostly pay for – you could file your taxes as head of household, rather than singly.
If you and your spouse each have 50 percent custody of your child(ren), you’ll really need to communicate in terms of deciding who gets to claim what on the tax returns. If there is only one child, it might make sense to alternate the tax deduction annually. Alternatively, the tax deduction may benefit one parent more than another. It is important to make sure you are in sync so that you do not get audited.
There are many options to consider when separated and filing taxes. The best thing to do in these situations is to get help from an expert.
Vanessa Soto Nellis is a Divorce Attorney in our Family Law Practice Group. Contact her via phone:818.907.3274; or by email: vnellis@lewitthackman.com for more information.