Tax Filing and Divorce
Right now you may be pulling together all of your tax records for last year and wondering if it would just be easier to file as single for 2020.
Here are some guidelines and considerations: • If you are still in the process of getting a divorce and were not legally divorced on Dec. 31 you are not single. You generally must file jointly or married filing separately.
• If you were legally divorced by December 31, you are considered single for the entire year. Even if you actually got divorced on the 31st of the year, for tax purposes you are still single for the whole year – it is not a choice.
• If you were married on the last day of 2020 and are now divorced, you can still file a joint return with your ex-spouse.
In most cases, married filing jointly will be more favorable than married filing separately. Some reasons for going the separate route, even if it results in a higher tax bill may include: • you do not trust your soon to be ex to honestly report income and you would prefer not to sign a joint return and expose yourself to liability
• your soon to be ex has significantly under withheld taxes or underpaid estimated quarterly taxes and will be liable for a big tax payment
• you will be entitled to a refund
• you have not filed tax returns for multiple years and wish to start cleaning this up before you get divorced.
Before making any decisions, please remember to consult with your accountant and with your divorce attorney.