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The tax implications of divorce, part two

Earlier this week, we wrote about some of the many tax considerations of a couple who is recently divorced or who are in the process of ending their marriage. Thus far, we have discussed whether couples should file jointly or as individuals during or after a divorce, and which parent should claim the child or children as dependents.

In addition to children, there are several other financial benefits that may become a source of dispute among divorced spouses. Most commonly is the deductions related to assets, such as mortgage or property tax. As with children, most family court orders should specify how these deductions are to be divided.

There are a few general principles that may help you determine which spouse is entitled to the deduction. For example, if one person bought out the other's equity in the marital home, the spouse who is retaining the asset will most likely be entitled to the property tax or other deduction. If the home is in the process of being sold, the spouses can split the deduction, or decide to file their taxes jointly.

One final common question about taxes as they relate to family law is the tax implications of child and spousal support. In general, child support has no effect on taxes. The parent who receives the support payments (on behalf of their children) does not need to claim them as income, and the parent who pays them may not deduct them.

For alimony, however, the reverse is true. The spouse who pays alimony may deduct it from their gross income, and the recipient must claim it as income.

If you have any specific questions about your tax situation during or after a divorce, it may be beneficial to contact an experienced Georgia family law attorney or tax professional.

Source: The Huffington Post, "Top 4 Tax Tips For Divorcing Couples," Bari Zell Weinberger, Feb. 24, 2012

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