Divorce And Taxes In The Time Of COVID

If you thought divorce was difficult pre-COVID, well, welcome to divorce in the time of COVID. We’ve entered a whole new world of discovery of things that can split up couples and families like nothing we’ve seen before. Disputes over whether or not to wear masks, conflicts about home-schooling, to vaccinate or not, to believing or denying whether COVID is real or merely a conspiracy foisted upon the world by who-knows-who! Besides killing more than 5 million people around the world, COVID has sent divorce rates soaring.

Between a nerve-shattering divorce and the nerve-wracking filing of tax returns, it’s easy to make mistakes and end up getting on the wrong side of the IRS. That just means red flags flying on their end, which will eventually make their way back to you.

I’m not a divorce attorney, I’m a tax attorney, yet I’ve seen my share of people get into some complicated tax troubles because of mistakes made during a divorce. So, if you have gotten a divorce during COVID, particularly if your divorce was finalized before midnight on December 31st, 2021, pay close attention. And make sure your tax preparer gets all the facts straight.

No Matter Your Marital Status Make Sure You File Your Taxes

First and foremost, whatever your current status, divorced, separated or still married, make sure your tax returns are filed. Also, if you were not involved in filing your tax returns during your marriage, you want to make sure your tax returns were in fact filed every year. This is one of the most shocking things a spouse who hasn’t been responsible for making sure tax returns are filed may discover upon divorce. And it can lead to complications with the IRS.

If you enter the New Year before your divorce is final, the IRS will recognize you as married, and you will still be allowed to file a joint return for the previous year

You May Have To File Two Separate Tax Returns

If you complete your divorce on or before Dec. 31 (the final day of the tax year) then you cannot file a joint tax return for the upcoming tax season. However, if the new year starts before your divorce becomes official, the IRS will still recognize you as married, and therefore allow you to file a joint return for the previous year. But in the year you are officially divorced, you will have to file a separate individual tax form dealing with the months that you were married.

Make Sure You Have Copies Of Tax Returns For The Years You Were Married

As I mentioned earlier, you need to make sure you have actually filed an income tax return for every year you were married. It’s important to get copies of all of your filed tax returns for every year of your marriage, going back at least seven years. If the IRS determines in the future that you or your spouse owe taxes while you were married, you will have documents to prove otherwise.

If you need help unraveling tax issues due to divorce or anything else, give our office a call.

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