Divorce changes far more than your marital status — it changes how you file your taxes, who can claim your kids, and how support payments are treated. These details are easy to overlook in the middle of a divorce, but they can have a real financial impact for years afterward.
Filing Status Depends on Your Status on December 31
Your tax filing status for a given year is determined by your marital status on the last day of that year. If your divorce is finalized on or before December 31, you’ll typically file as single or head of household for that entire tax year, even if you were married for most of it. If it isn’t finalized until January, you’re generally still considered married for the prior year’s taxes. This timing detail is worth discussing with both your attorney and a tax professional as a divorce nears its end.
Claiming the Kids
Claiming children for purposes of federal income taxes frequently comes up. This, like all matters relating to income taxes, is governed by federal law, whereas your divorce is a state-law matter. The state court judge cannot make orders that change who can claim children under federal law. However, parents can make agreements that can be included and reflected in the state-issued divorce decree. Because only one parent can claim a given child as a dependent in a given tax year, divorce decrees commonly address this directly — some alternate the dependency exemption by year, some assign specific children to specific parents. If no agreement is made to the contrary, federal law continues to control. In any event, two parties claiming the same child is a clear path to the IRS flagging your tax return and should be avoided.
Child Support Is Not Taxable or Deductible
Child support payments are not counted as income for the receiving parent and are not tax-deductible for the paying parent. This is a common point of confusion, particularly for anyone comparing their situation to older spousal support rules.
Spousal Maintenance Rules Have Changed
For divorces finalized after 2018, spousal maintenance (alimony) is no longer deductible by the paying spouse or counted as taxable income for the receiving spouse under federal law — a significant change from the older rules many people still assume apply. This shift affects how maintenance amounts are negotiated, since neither side gets the tax benefit that used to factor into those discussions.
Retirement Accounts and Property Division
Dividing retirement accounts as part of a divorce settlement typically requires a Qualified Domestic Relations Order (QDRO) to avoid triggering early withdrawal penalties or unexpected tax consequences. This is a detail that’s easy to get wrong without the right paperwork, and correcting it after the fact is far more difficult than doing it properly the first time.
Tax questions during divorce are best handled with both a family law attorney and a CPA involved — we regularly coordinate with clients’ accountants to help avoid costly surprises. Contact us to talk through your situation with our divorce team.
