If you're getting a divorce or if your divorce was finalized in December, you will need to familiarize yourself with how divorce affects your taxes, especially if income taxes have been the last thing on your mind in recent months.
Divorce can have a big impact on your taxes, for example, spousal support and changing your name may be just a few of the things you need to consider. Here are some key tips to keep in mind if you are in the process of getting divorced.
1. Child Support
If you end up paying child support, please be aware that it is not tax deductible. If you receive child support, you will not be taxed on it.
2. Spousal Support
If you pay spousal support or alimony according to your divorce decree, you may be able to deduct it as alimony providing it qualifies for federal tax purposes. If the payments are not required by the divorce decree, they will not qualify as alimony.
3. Spousal Support Received
If you receive spousal support from your ex-spouse, it is taxable.
4. Changing Your Name
If you decide to go back to your maiden name after your divorce, you will need to notify the Social Security Administration of the change. You will also need to file Form SS-5, Application for a Social Security Card. You can get this form by visiting SSA.gov, or by calling (800) 772-1213 to order it.
Please be advised that the name on your tax return must match the Social Security Administration's records. If the name doesn't match, it will likely delay your tax refund.
5. Health Insurance Coverage
If the divorce causes you to lose your health insurance coverage, you are still required by law to maintain coverage for yourself and for any dependents that you claim on your tax return.
If you lose coverage due to your divorce, then it qualifies as a "qualifying event" and you can enroll for health coverage through the Health Insurance Marketplace during the special enrollment period.
For more information on divorce and taxes, visit our other blog "What You Should Know about Alimony & Taxes."
To learn more about divorce and taxes, don't hesitate to contact a Nassau County divorce lawyer from our firm. Call today for a free consultation.