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Contemplating Divorce: Tax Issues:
The personal income tax rate is classified under single, married filing separate, and married. Single individuals pay more in taxes than married couples. This is one of the main reasons couples stay separated for years. By filing jointly in their tax returns, the amount paid in taxes is significantly reduced. To some people it makes sense to keep the legal aspect of the marriage solely for tax benefits.
The highest tax rate of all is the category of "married filing separate." Most divorcing couples view this increased tax rate as a penalty by the government for dissolving a marriage. It is interesting how even our government takes advantage of us when we are most vulnerable. Hopefully in the near future this problem will be corrected.
This increased tax rate of being single only adds to the stress of the divorce. It is possibly an effort to keep marriages together, but with a divorce rate of 55% of 1st time marriages, disproves any argument that it is working.
If you divorce, most likely you will pay higher taxes. This is not always the case, but is certainly something worth looking into, understanding, and accepting as a potentially hidden financial aspect of any divorce.
| Divorce Tip: # 32 Alimony and Child Support obligations are debts which cannot be avoided by a Declaration of Bankruptcy. Sponsored by: Divorce Support Page |
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