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Tax considerations for those who divorced in 2021

On Behalf of | Mar 4, 2022 | Divorce |

The year 2021 was a significant one for many in Gulfport. Some people married. Others got new jobs or moved. Some people had a child. And some people divorced. If you divorced in 2021 you will want to pay attention to certain parts of your income taxes that may be different now that you are no longer wed.

Filing status

While you were married, you and your spouse may have filed your income tax return jointly. But if you divorced in 2021, you will file either as single or head of household. Generally, you can file as head of household if you have children, and your home is their primary residence for at least six months out of the year.

Mortgage interest and real estate taxes

If you were granted the family home in the property division process of your divorce and you have been the one paying the mortgage, you can claim the deduction for home mortgage interest and real estate taxes. If you and your ex continue to own the home together and share mortgage payments, the deductions are divided 50/50. Whether payments are made from separate funds or joint funds can impact who is awarded these deductions.

Children as dependents

One issue that comes up when parents divorce is who gets to claim their child as a dependent on their income tax returns. Sometimes this is negotiated and included as part of the divorce settlement. If not, generally the custodial parent will claim this exemption. Sometimes, especially if the parents are in different tax brackets post-divorce, it makes sense for them to trade exemption years.

The new year brings new changes to many in Gulfport. Divorce can be a significant change and can impact your finances and tax returns. It is important to review your divorce decree for information on claiming exemptions, so you can avoid making any tax mistakes.