How to File Your Taxes After a Divorce

With regards to claiming children as dependents in Community Property States, the exemption of a single child must be wholly claimed by one spouse or the other; the deduction may not be split in half If you have multiple children, two for example, it is possible for each spouse to claim one child each. However, if both of you attempt to claim the same child, the IRS will take a dim view and not allow the exemption on either return.

Filing Jointly

Oftentimes, filing jointly is the best way to go. A married taxpayer may claim the child and dependent care credits and, in the case of low-income taxpayers, the earned income credit. Also, some deductions, such as an dependency exemption for a non-working spouse or the deduction for a spouse's contributions to an Individual Retirement Account, can only be employed on a joint return.

Some of the other factors you should bear in mind and discuss with your tax advisor with respect to filing status would be the resulting tax rate, deductions and credits to be lost or gained, tax losses from a partnership or business losses, as well as potential liability for any potential misrepresentations by your spouse on with respect to their income or expenses. As previously mentioned, you could be held accountable for any misrepresentations by your spouse on a joint return and be forced to pay the resulting price is necessary, even if the divorce is already finalized.

This would be unless you could qualify as an "Innocent Spouse". Under these provisions, which basically hold true in both Community Property States and otherwise, you would not be held liable if you could prove the following:

* your spouse seriously underreported substantial amounts of income

* you did not know of such misrepresentation and had no reason to know of such (which would actually be difficult since a spouse is supposed to read a joint return before signing it)

* it would be unfair to hold you accountable

* you did not receive any benefit from the unreported income

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