Preparing Your Tax Estimates
The first step in preparing a tax estimate would be to gather all the relevant information. Often, one spouse manages the bookkeeping for the family. If your spouse traditionally took care of that business and is uncooperative about sharing the information, you may have to employ the assistance of an attorney or even possibly the court. Before enacting these types of measures, however, you may wish to point out that the legal fees of both you and your spouse will rise dramatically should these avenues become necessary.
Another way of obtaining relevant information would be to contact the family accountant, who should be able to provide copies of previous returns. Another option is to contact the IRS and acquire Form 4506. By executing and returning this form and returning it to the IRS, they will make available all SIGNED copies. The IRS also makes several informational publications available that can provide key advice to persons going through a divorce. The most significant of these publications would be:
Once the estimates are completed, it is now time to make one of the most important decisions of the entire divorce : how will you file your taxes?
Resources & Tools
I.R.S. RECAPTURE-- Recapture prevents a divorcing couple from dividing their property and calling the distribution alimony. Recapture applies to alimony when the alimony paid decreases by more than $15,000 annually within a three-year period after a divorce. If in a three-year period a taxpayer’s alimony decreases by more than $15,000 from the amount of the proceeding year, the I.R.S. regards the alimony payments as property distribution. It recaptures the obligor’s income retroactively. In this, the I.R.S. recovers the tax benefit of a deduction or a credit taken by a taxpayer and disallows the deduction.
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