If you count yourself among the many people across Texas making their way through a divorce, you may be experiencing considerable change in your life. You may, too, need to take a new and different approach to filing your taxes this year in the wake of your divorce, because such a significant life change can have substantial tax implications. At Laura Dale & Associates we recognize that divorce brings with it many changes, and we have helped many people facing similar circumstances navigate these changes and make informed decisions along the way.
According to Fox News, while your tax filing needs change in the wake of divorce, tax rules, too, are changing this year, and they can have far-reaching effects when it comes to your taxes. The more you understand about these changes and how they affect you, the less likely you are to experience unpleasant surprises, come tax time. So, what do you need to know about filing taxes after divorce in 2019?
For starters, the Tax Cuts and Jobs Act is changing the way former couples with spousal support arrangements in place file their taxes. More specifically, until this year, the party paying support was able to report those spousal support payments as deductions, while the party receiving spousal support payments had to report them as gross income. Starting in 2019, however, spouses who divorce their partners and pay support will no longer be able to deduct the support paid from their taxable income.
Another new tax change that takes effect in 2019 concerns any children you and your former partner may share. Prior to 2019, you and your former partner would need to determine which one of you was going to claim any children you share as dependents. In 2019, however, neither parent will do so, as the child tax credit will replace the exemptions you used to get for claiming dependents. You can find out more about navigating divorce on our webpage.