A Checklist for Preparing to File Taxes After a Divorce

life after divorce taxes
Preparing to File Taxes After a Divorce

There's that famous quote by Benjamin Franklin about how nothing is certain but taxes or death. Regardless of your previous involvement with tax preparation, your tax situation has likely changed if you're on your own for the first time in a while. And there's no avoiding it; your taxes will need to be done.

If the very thought of doing taxes stresses you out, I want to encourage you to work with a tax professional regardless of how simple or complicated your financial situation is. Don't hesitate to contact us if you need a recommendation for someone you can count on. 

Still, even if you're working with a tax professional, there are some things that you can do to prepare

How to Prepare to File Taxes After A Divorce

1. Collect all of your personal information

I'm sure you know that you'll need social security numbers for yourself and your dependents. It will also be helpful to have the following available:

  • A copy of last year's tax returns
  • A copy of your final separation agreement and parenting plan

The IRS has specific rules about filing status. However, your tax professional may need some information about your parenting plan to determine if you're eligible to claim head of household status. You can also visit the IRS website to learn more about your appropriate filing status.

2. Collect all of your 1099s, W-2s, and any other documents detailing your income for the year

It's common for people to move during or after the divorce process. If you've moved, confirm that you received all your 1099's and W-2s. If you have online account access, you may be able to access them online. If you've changed employers, you may need to contact your former employer to inform them about an address change. 

If you were divorced after December 31, 2018, spousal support is not taxable to the recipient, nor is it tax deductible for the payor at the federal level. However, your state may have different rules, so be sure that you're familiar with the rules in your state.

3. Documentation related to deductions

Tax deductions reduce your taxable income. Many of you may claim the standard deduction. However, you may want to itemize. If you provide your tax professional with the necessary information, they can help you determine which is in your best interest.

Some of the most common deductions include the following:

  • Retirement contributions
  • Education expenses (Form 1098-T)
  • Student loan interest (Form 1098-E)
  • Medical bills (but only if they are more than 7.5% of adjusted gross income for most taxpayers)
  • Property taxes and mortgage interest
  • State and local taxes

4. Documentation related to tax credits

While tax deductions reduce your taxable income, tax credits reduce the taxes you owe. Still, you're going to need some documentation to claim them. Here are some of the most common tax credits:

  • American Opportunity & Lifetime Learning Credits - These are education-related credits. Similar to the tuition and fees deduction, Form 1098-T is required to claim either. 
  • Child Tax Credit - The child tax credit is frequently negotiated in divorce cases. Review your divorce agreement to determine if you or your ex can claim the child tax credit(s) for the current tax year.
  • Saver's Credit - If you have not yet contributed to a retirement account, check with your tax professional to see if you might benefit from a contribution.

5. Estimated Tax Payments

If you have made estimated tax payments in addition to the income taxes withheld from your paycheck, collect that information to share with your tax professional.

Tax laws are complicated, so there is much more to consider beyond what we've included here. We've focused on some of the more common issues but talk with your tax professional about additional documentation that may be necessary for your unique situation. 

Related post: Post-Divorce Financial Stability: Your Comprehensive After Divorce Checklist


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