Thoughtful Guidance From Skilled Attorneys

Should Your Divorce be Final by December 31? What are the Income Tax Consequences?

On Behalf of | Nov 24, 2015 | Firm News


Do you have a divorce pending as a lawyer or a party? If your divorce is eligible to be final before the end of the year do not forget to consider the income tax implications of the date of the divorce. Also, remember that courts may not be open the full day or at all on December 31 or that the court may be busy and not be able to get to last-second filings.

The IRS website states,
“The IRS offers these seven facts to help you choose the best filing status for you.

  1. Marital Status. Your marital status on the last day of the year is your marital status for the entire year.
  2. If You Have a Choice. If more than one filing status fits you, choose the one that allows you to pay the lowest taxes.
  3. Single Filing Status. Single filing status generally applies if you are not married, divorced, or legally separated according to state law.
  4. Married Filing Jointly. A married couple may file a return together using the Married Filing Jointly status. If your spouse died during 2012, you usually may still file a joint return for that year.
  5. Married Filing Separately. If a married couple decides to file their returns separately, each person’s filing status would generally be Married Filing Separately.
  6. Head of Household. The Head of Household status generally applies if you are not married and have paid more than half the cost of maintaining a home for yourself and a qualifying person.
  7. Qualifying Widow(er) with Dependent Child. This status may apply if your spouse died during 2010 or 2011, you have a dependent child and you meet certain other conditions.”

Look at paragraphs one (1) and three (3). Paragraph three (3) is not as simple as it looks as the IRS may require state law to meet certain standards for the term “separated” and it does not mean you just do not live together. You should consult a Certified Public Accountant (CPA) to verify your situation.

If your divorce is final by December 31, will you have a higher or lower tax bracket? If you are not divorced by December 31, how will the refund or tax liability be handled? Who gets the exemptions for any children and will you qualify for head of household as described in paragraph 6? These decisions could mean thousands of dollars difference in your tax liability and should be given consideration.

Prepared by Richard A. Mann of Richard A. Mann, P.C. Attorneys at Law,

Follow us on Facebook: and Twitter: @RAMattorneys