Divorce can be a scary process with many open questions. Especially in the midst of tax season, you might experience confusion about how to handle your income tax return as a newly divorced individual. Fortunately, in most cases, the answers you might seek are not so complicated.
What filing status do you use?
The filing status you choose depends on when your divorce was final. If it was finalized at the beginning of the new year, you could still file jointly for the previous year. If it legally ended before the start of the new year, you will need to file separately. If you are still single and have a child in your home, you can file as head of household.
Is alimony tax deductible?
If you formed an alimony agreement after the last day of 2018, you cannot deduct payments from your taxable income. However, if your alimony agreement pre-dates 2019, it is still deductible.
Is child support tax deductible?
Child support is never deductible, and it does not constitute income for the receiving ex-spouse.
Who claims the children as dependents?
The custodial parent is typically the one who claims the children as dependents. This individual usually lives with the children the majority of the time throughout the year. However, when parents share equal custody, they will often come to an agreement that allows one parent to claim the child every other year. Parents of more than one child will often each claim a child to balance things out.
Custodial and non-custodial parents may qualify for different tax benefits. Additionally, even an explicit custody agreement cannot override divorce tax law.