Three Things To Discover During The Last Joint Tax Prep Before Divorce

Have you started work as a freelancer but haven't filed your taxes by yourself before? Learn how an accountant can help handle your finances.

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Three Things To Discover During The Last Joint Tax Prep Before Divorce

20 July 2016
, Blog

If you are separated and are filing for divorce, you still have the option to file as married during your separation. As long as the divorce is not yet finalized, you would be able to file as married filing jointly. If this is your last tax preparation with your soon to be ex-spouse, there is some information that you want to find out and keep with you for the future. Here are some things to go over in the last tax preparation while married. 

Income over the past two years

Income will account for a lot in divorce if someone is asking for alimony or child support. If you or your spouse will be asking for alimony, look at the laws in your state and determine how much of your income will be used to calculate alimony and child support. If the two of you have wound up having a similar income, there may be no alimony ordered. Knowing incomes and their disparities, this will help both of you determine what your incomes are likely to look like after the divorce is final. 

What tax cuts are cut

One of the questions that you want to ask your tax professional is what tax cuts you will be eligible for while single. It may turn out that you need to prepare to pay several hundred to several thousand more due to not having the ability to take tax cuts. For instance, if you have dependents, the two of you may need to switch off on who can claim the child tax credit. If you held property together that gave you tax cuts, the property may need to be sold and the proceeds divided, wiping out this tax cut entirely. Ask your tax preparation expert for a mock-up of what your taxes will look like single.

Determine who can support which property

If you own several different pieces of property together, you should ask who is likely to be able to carry the property with the maintenance and taxes on the property. If the two of you can figure out what is affordable on your incomes now, this may make it easier during the divorce. If you can come up with a plan to divide the liabilities based on who would receive better tax cuts and who would be able to pay the necessary taxes, the division of assets and divorce will come easier. 

To learn more, contact a tax specialist like Alexander & Associates CPA.