Divorce can be a lengthy and expensive legal process if you fail to retain the services of an experienced legal representative. If you’re planning to file for divorce, it’s important to contact an attorney who is well-versed in recent legislative changes, including the Tax Cuts and Jobs Act (TCJA). With 2018 drawing to a close, we are quickly approaching the last tax season that provides specific tax benefits and exemptions to divorced couples.
A judge may award spousal support if it helps a lower earning spouse adjust to a living off a single source of income. Ideally, these monthly payments can help the spouse sustain their standard of living as they pursue new and better career opportunities. Prior to the TCJA, alimony payments were considered taxable income for the receiving spouse and tax deductible for the paying spouse. As of 2019, this policy will no longer apply to any new spousal support orders or alimony modification.
Dependent Exemption Dedications
In the past, parents could claim eligible children as dependents on their tax returns. However, the TCJA is effectively eliminating all personal and dependent deductions. In the 2019 tax season, divorced parents will no longer be able to request or receive dependent exemptions.
Child Tax Credit
Fortunately, the TCJA is providing one auspicious benefit that may offset some of the disappointment incurred by the loss of dependent exemptions. The child tax credit, which is a dollar-for-dollar reduction, is doubling to $2,000 and can potentially yield a $1,400 refund. This can be an extremely important tax credit for custodial and noncustodial parents alike.
Important changes to the child tax credit include:
- Doubling the credit amount to $2,000
- Allowing partial credit
- Changing the refund guidelines
Learn More by Scheduling a Consultation
The overall divorce process can be confusing and overwhelming without an experienced guide. After all, there are so many important decisions to make before you can even begin to finalize your divorce settlement. At The Law Office of Jason R. Carpenter, we understand that each decision you make can significantly impact your post-divorce life. Our Harrisburg divorce attorney can guide you through each step of this legal process, handle any unexpected contingencies, and explain how these imminent tax laws may affect your divorce.
Contact The Law Office of Jason R. Carpenter at (717) 537-0928 to schedule a consultation.