Tax Considerations in Divorce—Frequently Asked Questions

Federal tax consequences can often be overlooked by the parties.

Many divorces have federal tax consequences often overlooked by the parties. Among the issues a divorcing party should discuss with his or her attorney or tax advisor are the following:

  • Whether the transfer of assets between spouses in a property settlement, particularly real estate transfers, will be a taxable event
  • Whether spousal support payments qualify as income to the recipient and a consequent deduction for the payer
  • Whether any portion of attorney fees is deductible
  • Which parent is entitled to the child dependency exemption

In addition to your attorney, if you have an accountant or tax advisor, he/she should also be consulted before reaching a final settlement in the divorce.

Continue to Conclusion