As the old saying goes, death and taxes are the only things that are sure in life. Hopefully, death is years from now, but unfortunately, taxes are an issue you have to deal with right now, and they’re not going anywhere. If you’re going through a divorce, your taxes are taken into account in various ways. Here are some important things for New Jersey residents to know.
Keep in mind that your tax status, such as head of household, single or married filing jointly, is based on your status as of Dec. 31 of the tax year. The timing of your divorce proceedings can make a difference in your taxes. For instance, if you normally filed jointly with your spouse, your withholdings from your employer are calculated based on your tax filing status.
Once your marriage ends, you’ll have to file as head of household or single. If you get a divorce later in the year, you may owe more taxes because you had withholdings for the majority of the year and are now filing single instead of married.
Tax tips for divorce
One way to make sure you don’t have to pay as much in taxes after your divorce is to hold off on your divorce until after Jan. 1 of the new tax year. If you settle your divorce near the end of the year, you may be able to wait until the first of the next year to officially get divorced. Weighing out your options and looking at the taxes you owe may help you make the tax-related decision that is best for your family’s future.