TAX LIABILITY

Taxes are a huge subject of debate in divorce actions.

• Who is going to be responsible for paying taxes on this year's income?

• Who is going to claim the children as exemptions on this year's taxes?

• Should the parties file jointly or separately (assuming they are still technically married on December 31st)?

• What will happen to the refund on last year's or this year's return?

• Who will be responsible for preparing this year's tax return?

• Will maintenance be taxable to the recipient and deductible to the paying party?

• Will one party indemnify the other from liability on state, federal and local taxes?  (Particularly important if there is a business enterprise involved.)

These are only a few of the questions you need to review with your attorney during the divorce process.

If you have a complex financial estate, you would probably be well advised to also consult with your Certified Public Accountant or a tax attorney.

The Internal Revenue Service has a great deal of information and material available on the subject of divorce and taxes.