Tax Help After Divorce

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Tax Help After Divorce

Postby cg27288 » Tue Jul 14, 2009 11:04 am

Hi

Recently divorced as of 2/6/09.

I'm really struggling with how to prepare for my 2009 taxes. Are there any good resources out there to help me make sure I am withholding enough for 2009 taxes? I am petrified that I am going to wind up with a huge tax bill that I can't afford come April 2010.

I guess I'll be filing single (clearly they don't have a divorced category lol) and the taxes definitely will go up I guess.

I have two children and we both get to claim 1. I pay alimony which I believe is deductible.

Any good resources or websites out there?

Thanks a ton
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Re: Tax Help After Divorce

Postby massdaddio » Tue Jul 14, 2009 11:38 am

If you are paying alimony and are claiming one kid, I don't think you will have any issues. Do you use a software program for your taxes? If you do, then make a copy of your 2008 file and modify it for your current conditions. You can use a recent paystub to calculate all your withholding. It won't be exact, but should give you a good idea.
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Re: Tax Help After Divorce

Postby kmich91262 » Tue Jul 14, 2009 11:48 am

Based on your situation I would highly suggest going to the IRS.gov website. They have a calculator that calculates what you should be claiming based on your projected gross, federal taxes currently taken out, last fed tax deducted amount, alimony paid, ect. I have had good luck with the website however do suggest that you check with it at the beginning of the year, middle of the year, and usually around September to ensure you won't end up owing a buch of money back. The website is free which most people like the word free. Just my two cents of input.
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Re: Tax Help After Divorce

Postby motwgk » Tue Jul 14, 2009 12:26 pm

You can also probably file as Head of Household, which will help reduce the amount you owe. Check with the IRS website.
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Re: Tax Help After Divorce

Postby rain » Tue Jul 14, 2009 12:27 pm

Are you the custodial parent? Ideal would be for you and your ex to agree that you have primary custody of one child and she has primary custody of the other. That way you can both file as Head of Household. If you have a good working relationship with your ex, I strongly suggest get this kind of arrangement. According to my accountant, had I been able to filed head of household I would have saved $10k in fed tax alone. Below is the difference in standard deductions:

Married filing jointly or qualifying widow or widower $10,900
Head of Household $ 8,000
Single $ 5,450
Married filing separately $ 5,450
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Re: Tax Help After Divorce

Postby cg27288 » Tue Jul 14, 2009 12:30 pm

rain wrote:Are you the custodial parent? Ideal would be for you and your ex to agree that you have primary custody of one child and she has primary custody of the other. That way you can both file as Head of Household. If you have a good working relationship with your ex, I strongly suggest get this kind of arrangement. According to my accountant, had I been able to filed head of household I would have saved $10k in fed tax alone. Below is the difference in standard deductions:

Married filing jointly or qualifying widow or widower $10,900
Head of Household $ 8,000
Single $ 5,450
Married filing separately $ 5,450


No she is the custodial parent for both my daughters even though we have joint custody. I never even knew that might be an option. Wow, what a difference.
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Re: Tax Help After Divorce

Postby rain » Tue Jul 14, 2009 12:51 pm

As I was typing the paragraph below and confirming what I was writing via internet searches, an article on this website popped up during my search. I need not say more . . .
www.dadsdivorce.com/article-archive/1625

Yes, and it goes beyond the standard deduction when filing head of household. If you are able to file as head of household, you can also claim the child care tax credit, which is $600 (only the custodial parent can claim this regardless of whether the other parent can claim the dependency exemption). You would also be able to use your flexible spending account for dependent care and medical care - again, only the custodial parent can use these benefits, not the noncustodial parent regardless of whether the noncustodial parent can claim the child for the dependency exemption.
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Re: Tax Help After Divorce

Postby kmich91262 » Tue Jul 14, 2009 1:13 pm

If I'm reading the article correctly, theoretically although the court orders says one thing (i.e. 2009 and 2010 I don't claim my son) I could end up claiming my son for next year since I'm projected to have more nights then NJ would. I will have to run this past my tax friends/co-workers to see what their opinion is.
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Re: Tax Help After Divorce

Postby sixbury » Tue Jul 14, 2009 2:02 pm

I used to work for a large tax company and still go back there to get my taxes done. 1st off I would not rely on the advice of friends as they may not be versed in all of the tax laws that a professional tax advisor is versed in. You may even want to talk to a CPA which can be expensive, but often offer better advice for things other than just taxes. i.e discuss your taxes and also offer some planning and tips.

You should be able to claim your child if you have them more than 50% of the time, but if you agreed to who was claiming which child in court then you should follow what you agreed to in court.
... also a suggestion is to file early as possible because if you are able to claim one of the children and the EX tries to claim that same child, the first tax return accepted by the IRS wins. or at least according to my guy who has been doing taxes for 20-25 years.

paying alimony makes a huge huge difference in what you owe or get back in taxes.. especially if you are like most of us that took it in the < hindquarters > when it came to alimony. I would have owed $Thousands$ back in taxes, but once my tax guy added the alimony, I got a few thousand back. (Granted I had mortgage interest, etc. etc.)

Alimony is tax-deductible, but child support is not. Some other things to consider are also reimbursement through work for a flexible spending account for medical or dependent care expenses... you may even be able to track mileage driven and other expenses associated with the care of the kids.. another reason why a pro will help you with things you could easily over look or miss.
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Re: Tax Help After Divorce

Postby kmich91262 » Tue Jul 14, 2009 2:43 pm

Sixbury, I do auditing for taxes but a different form of taxes (local). However I have friends that I know through work that do federal taxes as a side job (got the training and all that) plus one of them currently does work as I believe they call it an IRS designated rep (or something like that). Both are quite knowledgeable and hasn't steered me wrong. Usually what I do is research and then bounce it against both of them to see if they come up with the same conclusion as I do. The IRS is notorious for not putting anything in writing so they are of no help when it comes to getting a filing determination. Besides my experience with CPAs through this job aren't all that great...they are too general and usually wrong but just my opinion though.
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