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Staying On Top of Your Financial Obligations
Tax changes can be challenging to navigate, especially with a divorce. It's important to be aware of the tax implications of your split to make the best decisions for your financial future. Here are some of the most critical tax changes to keep in mind.
Withholding Status Changes After Divorce
When you get divorced, your withholding status may change. If you were withholding at the married level, you can no longer do so after ending your marriage. You may need to adjust your W-4 form so that the correct amount of money is withheld from your paycheck for tax purposes.
Tax Bracket Changes After Divorce
In addition, you can no longer claim the benefits of marriage on your taxes and must file as a single individual. It's important to note that this means different tax brackets to pay attention to.
Alimony and Child Support and Taxes
If you pay alimony or child support, those payments may no longer be tax deductible. Be sure to speak with a tax professional to determine how this will impact your tax bill.
Property Settlements and Taxes
When you divide property in a divorce, that property could be treated as taxable income. This could significantly impact your tax bill, so be sure to plan for it.
Retirement Accounts and Taxes
When you divorce, retirement accounts are often divided between spouses. This retirement asset division can have implications on your taxes, so it's important to understand how it will affect your individual tax situation.
These are just a few tax changes to remember after a divorce. For more information, contact a tax professional or visit the IRS website.
Get Help from a Divorce Attorney
If you have questions about divorce or are ready to start the process, contact the team at Law Office of Alexandra White, PC. We have helped numerous clients file for divorce and navigate the process successfully; we can do the same for you.
Learn more or schedule a consultation by calling (303) 647-4245 or visiting our website.
The material in this blog has been prepared for informational purposes only and is not intended to be used as tax, legal, or accounting advice. Before making any financial decisions, please speak with your local tax professional or another financial advisor.