Tax filings, in many ways, capture a significant picture of your life — or at least your life from the past year. They are obviously very important, and it is imperative that you provide detailed and accurate information when you are turning in a tax filing.
But taxes and tax rules also change, often dramatically, in the course of a year. The taxes and tax rules themselves aren’t the only things that change over the year. You can change. Your life may change. A major event may have occurred, and any or all of these things can alter the way that your taxes are calculated or implemented.
For example, getting married is a major life moment, and it also has a significant impact on your taxes. At the same time, divorce is also a major life moment, and it, too, will dramatically change how your taxes are calculated and how you file.
Getting a little more specific, let’s take a look at one particular element of divorce that can really affect you, your spouse and your taxes. Alimony, often called spousal support, is a critical factor to track in the months following your divorce. For tax purposes, the spouse that pays alimony can deduct it from their taxes, while the spouse receiving the support payments must include it in their income on their tax filing.
Make sure you keep detailed records of your alimony payments, whether you pay or receive such support. It is a vital organizational step for your tax filing.