When going through a divorce, the deadline for filing a tax deadline can come. When parties are married, most ordinarily file a joint tax return unless they are living separate and apart.
However, once has a divorce is taking place, filing a joint tax return can be tricky. With a joint tax return, both parties are signing that all the information contained in the tax return is correct.
It is true that filing jointly can come with various tax benefits. To find out the pros and cons, it is essential to talk to a certified professional accountant.
But when a party signs a joint tax return, both parties are agreeing to their income — in a joint and individual sense. These income figures are then largely used to calculate child support and spousal support. It is hard, if not impossible, for a party to come into court and later dispute these figures if they signed the joint tax return.
In some cases, one party might have a concern that the other spouse is overstating or understating their income. They also might be concerned about various other components of the tax return itself in terms of its truthfulness and accuracy.
When one or both of the parties are operating a family business, or have other non-traditional assets, tax returns can be even more complicated. There can also be more risks involved in terms of the various schedules that are attached.
In these circumstances, while there might be a tax benefit associated with filing jointly, this could be a reason a party opts instead to file a separate tax return where they note that they are married, but living separate and apart. Otherwise, a party could theoretically end up being audited or, worse yet, get in trouble with the Internal Revenue Service.
For parties going through a divorce, it is vital not just blindly to sign a joint tax return. Instead, many need to seek out the advice of a certified public accountant before they make their decision along with discussing the matter with their divorce lawyer.