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What are the tax decisions that a divorcing couple must face?

These include, but are not limited to, 1) the payment of any balance due on a joint income tax return; 2) the distribution of any tax refund; 3) the claiming of children as dependents if separate returns are filed a) during the divorce or b) after the divorce; 4) which spouse responds in the event of a tax examination; 5) who pays taxes, interest and penalties in the event of deficiency; 6) the rights of the innocent spouse in the event of a tax deficiency by the other.

As long as the divorcing spouses negotiate and honor their agreements in good faith, they can save themselves money and aggravation.

These are questions that the spouses can answer, independent of the Internal Revenue and its regulations, and if the arrangements are fair and reasonable, the courts will approve them. When a couple makes informed decisions, independent of lawyers, the spouses can save themselves money and create for themselves the most favorable tax consequences.