Few things create anxiety quite like tax season, unless you are also going through a divorce. If you are considering filing for divorce in Illinois, the question of how and when to file your taxes can feel overwhelming. This one decision could affect your refund, your liability, or even your divorce settlement. The good news? With the right guidance, you can protect yourself financially and move forward with confidence.
Your Marital Status on December 31 Controls Your Filing Options
In Illinois, your tax filing status is determined by whether you are legally married on December 31 of that tax year. If your divorce is not finalized by that date, the IRS still considers you married—even if you have been separated for months or even years.
Therefore, if you and your spouse separated in June but your divorce is not finalized until March of next year, you must file as either Married Filing Jointly or Married Filing Separately for that tax year. Filing as Single would be incorrect and could possibly trigger penalties or audits.
Married Filing Jointly vs. Married Filing Separately Is a Strategic Decision
Choosing the right filing status can have significant financial implications, so it is important to understand how this decision aligns with your divorce strategy. Many couples assume filing jointly is always better because it often results in a lower tax bill. However, during a divorce, filing jointly can expose you to risk—particularly if you do not trust your spouse’s financial disclosures.
If your spouse underreports income or claims improper deductions on a joint return, the IRS can hold both of you responsible, even after the divorce is finalized. Filing separately may result in a higher tax bill, but it can limit your liability and protect you from your spouse’s financial misconduct.
An experienced divorce attorney can help weigh the tax savings against the legal and financial risks.
Dependents, Child Tax Credits, and Who Gets to Claim the Kids
One of the most common tax disputes during divorce involves children. The IRS has strict rules about who can claim a child as a dependent, which directly affects tax credits, refunds, and filing status.
Only one parent can claim a dependent for a given tax year. Generally, the parent with whom the child resides for more than half the year claims the dependency exemption and child-related tax credits. However, divorce agreements often allocate these benefits by alternating years or sometimes assigning the exemption to the higher-earning parent.
If this is not clearly addressed during your divorce, you may face disputes, delayed refunds, or IRS challenges down the road.
Do Not Let Tax Season Derail Your Divorce Strategy
Divorce and taxes intersect in ways that can impact your finances for years to come. Filing incorrectly, or without considering how your divorce will unfold, can cost you thousands of dollars and create unnecessary stress.
If you are considering divorce or already in the process, the experienced attorneys at Hayes Law, LLC can help you navigate these complex decisions with clarity and confidence. Our firm understands the financial, legal, and emotional challenges that come with divorce, and we work strategically to protect your future.
Contact Hayes Law, LLC today to schedule a consultation and discuss your divorce and tax-related concerns before you file. The right guidance now can make all the difference later.
