David P. Badanes, Esq.

If you are getting divorced or thinking of getting divorced, you should consult with an accountant or tax expert. The following are some of the issues involved with your taxes when getting a divorce.

If your divorce is not final and you were still married on December 31, then you can still file a joint tax return. Even in the middle of a divorce, if the divorce is not final on December 31, then the IRS considers you still “married”, and you can still file a joint tax return.

Alternatively, even if your divorce is not final, you may want to file a separate tax return. You have the absolute right to file a separate tax return, and you do not need the Court’s or your spouse’s permission to do so. However, in most situations, if you are still “married” and you file a separate tax return, you will probably pay more in taxes than if you filed a joint tax return.

If you are getting divorced, then there are several other issues to consider. If you have children, then it must be decided which spouse will get the tax exemption (i.e., claim the child as a dependent) on their tax return. This can be done by agreement between the parties or the Court can order which spouse gets the tax exemption.

If you are paying child support, child support is not deductible on your income. If you are receiving child support, then the amount of child support received is not considered income.

In contrast, if you are paying spousal maintenance (alimony), then in almost all instances the amount of spousal maintenance paid is a deduction from your income. The amount of spousal maintenance received is considered additional income.

If you are receiving spousal maintenance, it is important to plan for the extra income that you will be receiving that will eventually be taxed upon.

During or as a result of a divorce, any transfers of property, real or personal property, are typically non-taxable transfers. However, when the transfer is made the property retains its “cost basis.” This is a complicated tax issue that is best handled and explained by your accountant.

The Badanes Law Office has helped numerous clients in their divorce. The Badanes Law Office makes sure you understand the different tax consequences that occur in a divorce. If you are thinking of getting divorced, call David Badanes and the Badanes Law Office today at 631-239-1702, email at david@dbnylaw.com or visit our web site: www.dbnylaw.com. The Badanes Law Office has offices in Northport, Suffolk County and Garden City, Nassau County.

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