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If You Are Considering Filing a Divorce In Indiana This Year The Deadline is Near Delay Can Affect Your Taxes

by | Oct 4, 2021 | Firm News

Under Indiana law there is what is commonly known as a mandatory waiting period after the filing before a divorce can be final. (The legal term is dissolution of marriage but for this article the term divorce is used). Pursuant to I.C. 31-15-2-10, “in an action for a dissolution of marriage … a final hearing shall be conducted not earlier than sixty (60) days after the filing of the petition.”

The last court date in Marion County, Indiana is December 29, 2021. Another issue is that Marion County Courts will be moving their physical location sometime around the end of the year. During the holidays, courts are addressing emergencies and other matters, so a non-contested divorce may be pushed aside until after the beginning of the year. Therefore, your last reasonable date to file for divorce and this means file with the court is October 28, 2020, even then you are taking a chance your divorce will not be finalized. Many people think the 60 days starts when you see a lawyer to start your divorce, it does not. This assumes you will have an agreed divorce. Otherwise, depending upon the issues and the court involved, it may be too late to file the divorce and have it finalized before the end of the year. If children are involved, you are required to attend a class regarding divorcing with children even if you have an agreement. Due to the Covid-19, some courts are allowing online classes. You should check the local rules of your county. There is a current proposal to change the rule but the outcome will not be known for some time.
While Indiana law allows bifurcation of the divorce versus the other issues, see IC 31-15-2-14, most courts will not grant a bifurcated divorce without agreement of the parties, and many courts will not grant a bifurcated divorce at all, especially if children are involved. Further, your spouse may not agree as a matter of strategy especially if you are the higher income earner.
Now you might ask, what does it matter?
In 2017 the Congress changed the tax laws which can have significant financial impact on your lives. A summary of the laws can be found at here A review of this publication reveals that the IRS has not addressed many of the changes put into effect by the new law.
The Child Tax Credit, not to be confused with the Child Care Credit has changed. You should consult a Certified Public Accountant (CPA) to verify your situation.
Now that you must file online a judge will not see your paperwork filed on December 29, so your divorce will not be granted until after the first of the year. If your divorce is final by December 31 (remember courts are closed on December 31), will you be in a higher or lower tax bracket? If you are not divorced by December 31 (remember courts are closed on or after December 31), how will the refund or tax liability be handled? Who gets the exemptions (currently the child tax credit of up to $2000 per child) for any children and will you qualify for head of household? Who will receive the mortgage deduction? If you have not resided in the home recently enough are you going to be taxed on any sale? These decisions could mean thousands of dollars difference in your tax liability and should be given consideration.

Prepared by Richard A. Mann of Mann Law, P.C. Attorneys at Law,
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This blog does not constitute legal advice nor does it establish an attorney client relationship. This is for general information purposes as in most legal situations the facts and terms of an agreement between the parties can affect the result.