The upcoming tax deadline may be among your upcoming chores to respond to in a timely manner. In fact, there are probably only two other topics that weigh heavier on your mind: Your divorce, and your child(ren).
Filing taxes as a newly divorced father or mother will be much different from how you filed taxes before. There are several big differences that you will have to take into consideration. When you sit down to file your tax returns, these are a few helpful tips for you to follow.
Use your new status
In previous years, you probably filed taxes jointly with your spouse. This tax season is different, and your tax filing status will be different as well. If you are the custodial parent to your child, then you may file as head of household. However, if you have joint custody or your ex-partner is the custodial parent, you may not. Your filing status depends on the status of your custody arrangement as of Dec. 31, 2017.
Determine your dependents
Many divorcés wonder whether they can still claim their child as a dependent. Again, this depends on your custody arrangement. Whoever has sole legal custody of the child can list them as a dependent. However, you may also claim them as a dependent if you share joint custody and equal physical custody; you pay child support in excess of 50% of the cost to actually support the child(ren), or by agreement. Generally, the IRS will also honor an agreement between the parents about who claims the child as a dependent, and the IRS has Form 8332, "Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent", to formally document such an agreement.
Remember divorce-related deductions
You shoulc consult with a tax expert about several tax deductions that you may qualify to take that pertain to divorce and child-rearing:
- While you can't deduct attorneys' fees that you incurred during the divorce, you may be able to deduct some of the fees related to preparing your settlement agreement.
- If you pay your ex alimony, you can still deduct it from your taxes. Take advantage of this deduction while you can, because it will become invalid in 2019.
- If you pay your child's tuition or other college-related expenses, you may be eligible to deduct them. This will depend on whether you and your child qualify for the American Opportunity Tax Credit.
- You may be able to also deduct some costs of your child's health care, school expenses and daycare as well.