Whether you are currently going through a divorce or you have just recently filed for legal separation, there are several matters that must be taken care of. You may be occupied with issues involving property division, child custody and alimony, but forget to think about how the divorce will affect your taxes. The financial implications of divorce can be difficult to handle, and some may have long-lasting effects on your life. Taxes, for one, will most likely be different whether you are filing jointly or separately.
There are several things you must think about when filing your taxes during or after a divorce. First, the alimony you pay can be deducted in your taxes; however, it must be the amount of alimony named in the final divorce settlement or decree. If the total amount paid is over the amount set by the court, the extra amount is not tax-deductible. If you have received alimony, you must pay taxes on the amount received. Child support payments, on the other hand, are not tax-deductible, nor do you have to pay taxes on it.
Your health care coverage may change during your divorce, which could change your taxes as well. In some cases, a change in life circumstances will allow you to change your insurance coverage. You may also need to look into the factors required if you change your name during the divorce. The name on your taxes must match the name that is on file with the Social Security Administration.
This information is intended to educate and should not be taken as legal advice.