Tag Archives: head of household

Divorce and Taxes

6 Apr

While we all know that death and taxes are the only two things that are inevitable, with tax time fast approaching I am reminded about how divorce made me hate tax time all the more. On my twitter feed today was a post from Time magazine about this subject. In 2009, when I decided to get my divorce, I wasn’t thinking much about the tax implications. The only thing I did think about was that if I was living apart from my spouse for at least the last 6 months of the year, I could file head of household. Oh, the things you learn from you already divorced friends! Thing of it is, that doesn’t always apply and I didn’t know that at the time. Additionally, even though I was not living with him much of July, it wasn’t until August 1 that I¬†officially moved into my own place. As you can see, that was still¬†shy of the 6 months needed to even be considered as such. This year, still not able to be head of household. Why? Even though I have my kids half the time, I gave my ex the house and all three kids as his dependents to be claimed each year for tax purposes as he is the residential parent. I figured he’d be spending the most on their expenses as we’d agreed, but it’s still not working that way. I buy their shoes most of the time and I have to buy clothes for them to wear at my house so we’re not transferring things back and forth each week–not the way it was supposed to work!

So, back the the tax debacle…when I filed for my 2009 taxes, I realized I had to file single even though I had a status of married throughout the entire year. That meant that I had not paid into taxes enough. On top of it, while I pay child support, I don’t pay alimony. Child support is tax neutral while alimony is a deduction. I am happy that I am not paying alimony, but sad that my deductions are so few. That all meant that I owed a TON of cash to the government. I immediately corrected my filing status so that I would not be in such a mess for 2010. That change and the fact that I got a 20% pay cut in 2010 slashed my taxes owed from 2009 to 2010 by 75%. WINNING! No, not really. It still sucks. When you’re getting divorced, take all these things into consideration. One of the things I read in the Time article is that I could have switched the dependent piece so he gets to claim them one year and I get to claim them the next. That was something I had not considered. My ex also go a TON of cash back last year because he did get to claim everything, I could have asked that he split that with me. These are all considerations for you if divorce is something on your radar.

Stop being nice and conciliatory and just trying to get out and not make waves. Protect yourself so you don’t end up in another D word like me…DEBT!