The IRS determines your filing status as of the end of the year, so if you are divorced by the end of the year, the only filing statuses available are single or head of household. In contrast, if you are still married as of the end of the year, then your filing status choices are married filing joint, married filing separate, or under certain circumstances, head of household. In order to claim head of household, all of the following conditions must be met: (1) you and your spouse have to have lived apart for at least the last 6 months of the year, (2) you aren’t filing a joint tax return with your spouse, (3) your home was your dependent child’s main home for more than half the year, (4) you paid more than half the costs of maintaining your household, and (5) you must meet all the criteria for claiming your child as a dependent.
Who claims the income in the year of divorce and during the divorce process is also determined based on a few factors. Generally, in Nevada (a community property state) income earned during marriage is considered community property. This means that each spouse is responsible for paying the taxes on the income earned during marriage. However, it can be a little tricky during the divorce process and the year of divorce to determine who claims the income. If while the spouses are married they are reliant on the same source of income, generally the income is split between each spouse equally up until the date of divorce. There are exceptions to this depending on if the spouses maintained separate households, whether or not the spouses depended on one spouse’s income, if they transferred earned income, if they each were able to support themselves on their own income, or if the spouses included in their divorce decree how the income would be divided in the final year of marriage. For example, if one spouse was the only worker and provided the only source of income for household expenses, the spouses would split the income equally through the date of divorce.
As mentioned above, there are many factors you need to determine when filing your taxes during the divorce process and after you are divorced. You should contact a CPA to discuss your options before filing your taxes and finalizing your divorce decree.
Lisa Bagley is a CPA and CVA (Certified Valuation Analyst) who assists her clients with tax preparation, business valuations, calculating income available for alimony and child support, preparing forensic accounting analysis, and preparing schedules to identify and assist in dividing marital assets and debts. She has experience working with clients in the collaborative model for divorce as well as working as an expert witness in litigated divorce. She is the President of Tax & Advisory Services, PC and can be reached at (775) 359-1040 or firstname.lastname@example.org.