The adage says that the only sure things in life are death and taxes. Around this time of the year, most people are starting to receive the various forms and documents necessary to file their 2021 taxes.
If you are currently going through or are considering a divorce, you may be wondering how to handle your next tax filing. Are you required to file your tax return jointly with your spouse? What forms should you expect to receive? Should you retain copies of your W2 and 1099s to provide to your attorney?
Generally, the Internal Revenue Code provides married couples with a choice to file jointly or separately. In many situations, filing a joint return can be beneficial and reduce a couple’s overall tax debt. However, filing jointly also comes with burdens. A joint return can expose a spouse to liability for fraudulent or misrepresentations made on the return even if that spouse did not sign the return. Unsurprisingly, this combination of benefits and burdens can and has led to tension and disagreement between divorcing couples.
When you are in the process of negotiating a settlement for your divorce, there are many specific tax issues to be aware of and to consult the appropriate professional before entering into any agreement or taking a position about any particular asset. Your divorce attorney cannot give you tax advice. However, you always have the right to seek independent tax consultation from a CPA or other tax expert to learn about the potential impact and tax effect of any settlement offer that you make or receive, or any agreement that you intend to sign.
If you are contemplating or currently going through a divorce, are concerned about a proposed division of assets during a negotiation, or have a dispute regarding the filing of joint tax returns, or have other questions the experienced family law attorneys at Cohn Lifland Pearlman Herrmann & Knopf, LLP can help you understand your rights and obligations. Call us for more information.