Filing status.
Filing status is based on your status as of December 31. If you are divorced
under a final decree by the last day of the year, you are considered unmarried
for the whole year and you cannot choose Married Filing Jointly as your filing
status. If you are still married at the end of the year (your divorce is not
yet finalized), then you must file as Married Filing Jointly or Married Filing
Separately, or Head of Household, if qualified. You cannot file as Single if
you are married.
Joint
responsibility. You may be held jointly and individually responsible for any
tax, interest, and penalties due on a joint return filed before your divorce.
This responsibility may apply even if your divorce decree states that your
former spouse will be responsible for any amounts due on previously filed joint
returns.
Name change. If you
changed your names because of divorce, be sure to report the change to your
local Social Security Administration office before filing your tax return. The
name you enter on your tax return must be the same as what is on your Social
Security card.
Exemptions. If you
obtained a final decree of divorce or separate maintenance during the year, you
cannot take your former spouse’s exemption. This rule applies even if you
provided all of your former spouse’s support.
Dependents. In most
cases, a child of divorced or separated parents is the qualifying child of the
custodial parent (the parent with whom the child resides for the greater number
of nights during the year). If the parents divorced or separated during the
year and a child lived with both parents before the separation, the custodial
parent is the one with whom the child lived for the greater number of nights
during the rest of the year.
Estimated tax. If
you made joint estimated tax payments for the current year and you were
divorced during the year, either you or your former spouse can claim all of the
joint payments, or you each can claim part of them. If you cannot agree on how
to divide the payments, you must divide them in proportion to each spouse’s
individual tax as shown on your separate returns for the current year.
Property Settlements
and Transfers
If you transfer your
home to your spouse or you transfer it to your former spouse incident to your
divorce, you will not recognize gain or loss. This is true even if you receive
cash, release of marital rights, assumption of liabilities, or other consideration
for the home.
Incident to divorce.
Transfers are incident to divorce if they are:
Made within one year
after the date the marriage ends, or
Related to the
ending of the marriage—made under an original or modified divorce or separation
instrument within six years after the date the marriage ends. Transfers that do
not meet these conditions are presumed not to be related to the ending of the
marriage.
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Sale of residence.
For purposes of the sale of home exclusion of gain, an owner is treated as
using property as his or her principal residence during any period that use is
granted to a spouse or former spouse under a divorce or separation instrument.
Deducting Costs of
Divorce
Generally,
attorneys’ fees and other expenses paid in connection with divorce are not
deductible.
Exceptions:
Fees paid to
determine tax or for tax advice on federal, state, or local taxes of any type
are deductible.
Fees paid to get or
collect alimony are deductible.
Fees paid for a
spouse or former spouse are not deductible but may qualify as alimony.
Alimony
Alimony is a payment
to or for a spouse or former spouse under a divorce or separation instrument.
It does not include voluntary payments not made under the instrument. Alimony
is deductible by the payer and must be included in the recipient’s income.
Designating payments
as “not alimony.” Spouses can agree not to treat otherwise qualifying payments
as alimony. A provision clearly instructing that the payment is not to be
treated as alimony must be included in a divorce or separation instrument or in
a written statement signed by both spouses that refers to a previous written separation agreement.
If spouses are subject to temporary support orders, the designation must be in
an order. A copy of the written instrument must be attached to the recipient’s
return.
Payments to third
parties. Payments to third parties under a divorce or separation instrument can
qualify as alimony. Payments are treated as received by the spouse and then
paid to the third party. The recipient can claim deductions for items paid with
the alimony.
Home occupied by
spouse. If, under the terms of a divorce or separation instrument, one spouse
occupies a home that belongs to the other, the owner’s payments for mortgage,
real estate tax, insurance, and repairs are not alimony. Payments for utilities
may be alimony. Rent-free use of property is not alimony.
Child Support
Child support is not deductible by the payer or taxable to
the recipient. Payments specifically designated as child support in a divorce
or separation instrument are not alimony.
Payments not specifically designated
“child support” are treated as child support if they are reduced either:
• On
the happening of a contingency relating to a child (reaching a specific age or
income level, leaving school, marrying, becoming employed, dying, leaving the
household, etc.).
• At
a time that can be clearly associated with such a contingency.
Underpayment of alimony or child support. If alimony and
child support are both required under a divorce or separation instrument, and
payments are less than the total required, payments apply first to child
support and then to alimony.