Divorce and Uncle Sam: Top 10 Things You Should Know When Filing Your Taxes by by Jessie Danninger, CPA, Rosen Divorce

Divorce and Uncle Sam: Top 10 Things You Should Know When Filing Your Taxes by by Jessie Danninger, CPA, Rosen Divorce

If youve recently divorced or separated from your spouse, here are a few things you should know for the upcoming tax season:

1.What is my filing status? (Married, Single, Head of Household)
Marital standing at year end determines your filing status for the entire year. If you have a decree of divorce or separate maintenance, signed by a judge, you should file as single. Regardless of whether you have a signed decree you may be able to file as head of household. Filing as head of household may reduce your income tax obligation, but to qualify the following conditions must be met:
oYou paid more thanthe cost of keeping up your home for the tax year,
oYour home was the main home for your child for more thanthe year, and
oYour spouse hasnt been a member of the household for 6 months.
If you cant file as single or head of household, then you must either file as married filing joint or married filing separate.

6.Should my spouse and I file as married, filing separate or married, filing joint?
Filing joint may provide some tax benefits over filing separate. However, by filing separate the IRS cant hold you responsible for any unpaid taxes caused by your spouses actions or omissions. The innocent spouse rule provides relief from this responsibility in some cases.

2.Is alimony taxable?
In general, alimony is taxable to the recipient (line 11 of the 2004 Form 1040) and deductible to the payor (line 34a of the 2004 Form 1040). However, some couples stipulate in their separation agreement that the alimony wont be deductible to the payor, or taxable to the recipient.

3.Is child support taxable?
No. Child support is neither taxable to the recipient nor deductible to the payor.
If the payor owes both alimony and child support but pays less than the total amount owed, the payments apply first to child support and then to alimony. If the separation agreement doesn't delineate separate alimony and child support payments, general "family support" payments are treated as child support for tax purposes, unless the alimony qualifications are met.

4.Who gets to claim the dependency exemption for the children?
In general, as long as the parents combined contribute at leastof the support of the child, the custodial parent gets the dependency exemption for the child. If custody is split or undeterminable, the parent who had physical custody for the greater part of the year gets the dependency exemption. Custodial parents can waive their right to the dependency exemption by filing Form 8332.

5. Who gets to claim the Child Tax credit and the Household and Dependent Care credit.
Only the parent who claims the exemption for the child may claim the Child Tax credit for that child. Unlike the exemption, it cant be traded. If you are the custodial parent, you can claim the Household and Dependent Care credit for the child even if you cannot claim the childs exemption. If you are the non-custodial parent, you cannot claim the Household and Dependent Care credit for the child even if you can claim the childs exemption.

7.Are my divorce costs deductible?
In general legal fees are considered personal expenses so they arent deductible.
However legal fees paid to get alimony and legal fees regarding the tax effects of divorce are deductible. The attorney must allocate fees paid for deductible and non-deductible services otherwise the deduction may be disallowed. The allowed deduction is a miscellaneous itemized deduction which is deductible only to the extent that, in the aggregate, the miscellaneous deductions exceed 2% of the taxpayers adjusted gross income.

8.My spouse and I are using the married, filing separate filing status. Can I use the standard deduction if my spouse itemizes?
No. If spouses are using the married, filing separate filing status and one spouse itemizes their deductions, the other spouse must itemize as well.

9.Who gets the mortgage interest deduction and other itemized deductions?
If the marital home is owned by one spouse alone, only that spouse may claim a mortgage interest deduction. Deductible expenses that are paid out of separate funds, such as medical expenses, are deductible by the spouse who pays them. In general, deductible expenses paid out of joint funds are split 50/50 between the spouses, including mortgage interest. Mortgage interest for property titled by the entireties can be claimed by whichever spouse actually paid the expense.

10.Where can I go for more information about divorce and tax issues?
www.rosendivorce.com

For more information on Rosen Divorce, or for an interview, please contact:
Alison Kramer, Director of Public Relations, Office: 919-256-1542, Cell: 919-523-7104 akramer@rosen.com or visit: www.rosendivorce.com

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With offices in Raleigh and Charlotte, Rosen Divorce is the largest divorce firm in North Carolina. Founded in 1990, the firm is dedicated to providing individual growth and support to couples seeking divorce by helping them move forward with their lives. Our staff of attorneys, accountants, and specially trained divorce coaches expertly address the complex issues of ending a marriage. Our innovative approach acknowledges that divorce is so much more than just a legal matter. Specialties include child custody, alimony, property distribution, separation agreements, and domestic violence relief.

ROSEN DIVORCE
4101 Lake Boone Trail, Suite 500
Raleigh, NC 27607
www.rosendivorce.com
Divorce is Different Here
About the Author
Jessie Danninger is a financial analyst with Rosen Divorce. She assist clients in all financial matters relating to divorce, including property distribution, child custody, alimony, and tax related issues. She is a certified divorce financial analyst and CPA.

Helping Children Cope With Grief by Theresa V. Wilson, M.Ed.

Helping Children Cope With Grief by Theresa V. Wilson, M.Ed.

Age is not a prerequisite to grief. Not unlike their parents, child must be allowed to experience the stages of grief. Denial of opportunity to release feelings, participate in family loss, and share in recovery can be very damaging to the health and well being of the child.

You do not have to be a psychologist or therapist to understand and use basic tools to address the needs of a grieving child. It does require recognition that kids are people too, and acceptance that their process of mending is no different than adults. Whether death or divorce, the stages of a childs emotional recuperating are very similar to adults, and must be fully addressed by the parents in order to reap positive results.

Never assume you know what your child may be thinking or feeling. Even in the closest relationships, he or she will keep their most intimate feelings as they assess, for themselves, the impact of the emotional trauma and related environment issues that have been forced upon them.

There are general stages of grief manifested in behaviors, attitudes and changes similar to the following:

Initial Shock which can be manifested in periods of withdrawal and silence or through wild behavior and disobedience;

Emotional Release which is a stage of becoming more aware of their loss and reacting with dramatic release of various emotions including crying without cause, striking siblings or becoming easily provoked. Some youth may exhibit a variety of disruptive behaviors in school in addition to anti-social responses at home;

Physical Symptoms include sleepless nights, nightmares, abnormal eating habits and digestive problems; and finally Guilt Feelings exhibited by blaming others for what they feel they have done to create the situation.

The road to recovery for youth may require that adults take a proactive role. There are several activities parents can use to create an atmosphere of comfort and support. These activities also encourage a closer communication between parent and child that moves far beyond the immediate crisis.

Encourage your child to prepare a picture album of favorite activities thy experienced with the loved one. This may include family outings, birthday celebrations, or special events and holidays.

Encourage the child to write a story or diary of events about the positive experiences they remember when the loved one was with them (purchase a colorful diary or notebook and include a special pen the child can use for this activity. Make this a personal experience for them that no one else can share. Do ask to read their diary entries or short stories. Let them offer to share when they are ready. If the child is unsure how to begin, suggest they develop a summary around the picture album.

Encourage the child to draw pictures of pleasant memories. Purchase a combination of crayons, paint and brushes. Make the project unique to them. Keep it easy and convenient to begin by making it clear supplies will be available as they find the need for them. The key here is to make sure their interest in expressing themselves is not dampened by the lack of supplies.

The key ingredient is your openness to explore whatever creative ideas are necessary to help your child move through the grief process and not become stagnate in any one phase. In helping children cope with the loss of someone they love keep the following in mind:

 Be honest and direct and truthful in explaining what happened. Creating stories to protect feelings may make the grief process more difficult in the long run.

 Allow and encourage children to express their feelings openly. Let them know that crying is normal, helpful and acceptable. Dont put time limits on this process. Each child is unique and will move along at a pace most comfortable to him. Dont compare or contrast one child from another and categorize strength or weaknesses. Help them know you accept their feelings, support positive choices and will guide them through negative experiences along the way.

 Accept individual emotions and reactions and dont tell the child what he or she should or should not feel.

 Listen to what the child is saying then focus on responding to the childs needs. Avoid putting words in their mouth or thoughts in their head. Become a good listener.

 Be a strong foundation, maintaining as much stability in the childs life as you can.

 Encourage the child to be part of some of the decisions the family will make during the death planning process. Take time to explain the process and procedures and always ask them how they feel. Dont band them from discussions.

 Be patient, recognizing that children may need to hear what happened again and again and will ask the same questions over and over. Not unlike the learning curve in school, repetition is helpful to reinforcing the meaning of an end of life process.

Grieving is an individual wilderness experience that is not exclusive to adults. Shock, anger, denial, guilt and behavior changes are human responses. Children need adults to help them connect to their resources, maintain a positive attitude, and walk in faith believing that they will heal and get through it. Knowing that someone cares will help make their wilderness journey easier to bear. You will both be victorious if you take a step back from your own pain and remember that children grieve too.

All rights Reserved. Permission is granted to electronically reprint the following article as long as no changes are made and the byline, copyright information, and resource box. Minimal content editing is allowed; however, you may request changes to the content by e-mailing requested changes. Off line printing is permitted. Please send a copy of the article on publication to: VMAssociates, Inc., PMB 47182, Windsor Mill, MD 21244.


About the Author
Theresa V. Wilson, M.Ed. is a freelance writer and owner of a home based business dedicated to providing products and resources for grieving families and caregivers facing health recovery and crisis related issues. Her Grief and Health support sites are www.meetingtheneeds.org and www.renewingyourhealth.org