Just like many areas around this topic, this can get messy. I’ll summarize, but if you are preparing your own tax return, the IRS has an entire publication for this that you should consult, Pub 504. There can be several filing options. The starting point on determining which options are available is whether the taxpayer is considered married or unmarried on the last day of the tax year (December 31st).
You are considered unmarried if:
- by the last day of the tax year you have a final decree of divorce or separate maintenance. Note that there is an exception that if you are getting a divorce one year to file tax returns as unmarried taxpayers and intend on marrying the next year, then you can’t file as if you are unmarried taxpayers.
- Or if you have obtained an annulment by the last day of the tax year. Since an annulment indicates the marriage never existed, you may have to file amended returns for previous years.
If you are considered unmarried by the end of the year, then you have two tax filing possibilities: single or head of household. Head of household has qualifying conditions related to maintaining a household with qualifying dependents. You can find more information about filing as head of household here.
You are considered married if:
You are married and have not obtained a final decree of divorce or separate maintenance by the end of the tax year. An interlocutory decree is not a final decree.
If you are considered married and you live with your spouse you have two filing options: Married Filing Jointly or Married Filing Separately. Note that Married Filing Jointly in most cases will result in the same or better net tax result as filing separately. When filing Married Filing Separately some tax credits and deductions may not be allowed or they may be severely restricted.
If you are considered married and you don’t live with your spouse, you may have an additional filing status available. If you qualify you can file for head of household. Again, there is qualifying criteria. Publication 501 is helpful in determining if you are qualified for filing as head of household. The Interactive Tax Assistant can also be useful to determine our filing status.
Two more points. In cases where divorcing taxpayers have children it can be helpful to coordinate tax filings to have the best overall tax situation. So when possible maintain communication and focus some on the best overall financial result in what may be an unfortunate situation.
And finally, even if a decree covers the claiming of children for tax purposes, if the custodial parent will not be claiming a child on a tax return it is a good idea to file Form 8332 Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent. This can help avoid future conflict, tax issues, and ensure the tax filing process goes as smoothly as possible.