Divorce is a significant tax event that complicates the maze of IRS regulations. Only filing status is discussed here as this is typically, the first step to filing. The IRS allocates five tax filing statuses: single, married filing jointly, married filing separately, head of household, and qualifying widow(er). State law governs whether you are married, legally separated, or divorced.
Prior to Final Divorce Decree
South Carolina does not recognize legal separation making this filing status simple. In effect, you are married until you are divorced, and separation is not divorce. Therefore, if you are separated, you must files taxes as a married person. You may file as “married,” or as “married filing separately.”
Upon Final Divorce Decree
If you received a divorce decree, or an order for separate maintenance, at any point in the calendar year, you are considered unmarried the entire year. If unmarried, you may file as “single” or “head of household.” In other words, you cannot file as “married” for the calendar year you obtained a divorce.
Once you file a joint return, you can’t choose to file separate returns after the due date of the return. However, you can change your filing status from a separate return to a joint return any time within 3 years from the due date of the separate return or returns.
If you live apart from your spouse and meet certain tests, you may be able to file as head of household even if you aren’t divorced or legally separated. If you qualify to file as head of household instead of as married filing separately, your standard deduction will be higher. Also, your tax may be lower, and you may be able to claim the earned income credit. This qualification requires you to meet specific standards not applicable to most people.
See IRS Publication 501 (2017) for additional information. Tax status can be confusing and complicated. Do not rely solely on this information. Seek advice from a qualified divorce attorney to ensure you file correctly and receive the lowest tax rate. To speak with an attorney at Hyde Law Firm, P.A., call us today at 864-804-6330.