Monday, January 19, 2015

Getting Divorced? 8 Things You Must Know about Taxes

Emma Johnson for Forbes writes:   Getting divorced? You have a lot going on. In fact, when you divorce, nearly every vertical of your life changes — including your taxes.

If your marriage is ending, address these tax concerns now. Below are the nuts and bolts of divorce and tax law. But if you are currently negotiating your split, or have a open dialogue with your ex, sit down with a tax professional to explore arrangements that could reduce the tax burden for both of you.
Filing status. If you were still legally married on Dec. 31, 2014, you can still file jointly with your soon-to-be ex. If you divorced during 2014 and you have agreed with your ex to claim any children as dependents, or they lived with you for more than half the year, you can file as single head of household, which allows you a bigger tax break. 

Who claims the kids. If the kids lived with you more than half the year, you claim them. However, regardless of your custody arrangement, you and your ex can agree out of court who claims the children as dependents. If the higher-earner makes too much (if they qualify to pay the Alternative Minimum Tax), he or she can allow the other parent to claim the kids, at $3,950 per child for tax year 2014.  SNIP, the article continues @ Forbes, click here to continue reading....

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