Whenever there are changes in householdis required communicate them to the Tax Authority. This is because it is a factor that has impact on IRS taxation. Therefore, if you have separated, know that you will be taxed differently in the first IRS after the divorce. Furthermore, if there are dependents, the process can become more complex.
In this article, we explain how does IRS taxation work after a divorcehow to declare changes in the household to Finance, and how to proceed with the division of expenses if there are dependents.
How does the first IRS work after divorce?
When a household is dissolved by declaration of nullity or annulment of marriage, by divorce or legal separation of persons and property, during the year to which the tax relates, the ex-spouses must carry out the IRS declaration according to your marital status current. In other words, when there is a judicial separation of persons and goods, each individual has to include own income and its share of common incomeif any, as well as the dependent income. even if the divorce was carried out in last month of the year to which the income relates, the IRS must be submitted separately. This is because the taxpayer’s marital status refers to the day December 31 of the previous year, therefore, when dissolving the marriage until that day, each ex-spouse has to opt for individual IRS taxation. if if divorced in 2022, please be aware that, for this year’s IRS declaration, the deadline for reporting changes in the household ended on February 27. If you missed the deadline and did not inform the changes in the household, you can do it when delivering the declaration, opting for the manual IRS and giving up the automatic.
How to report the divorce on the Finance Portal?
If you broke up this year, from January 1, 2024 you can report the divorce on the Finance Portal. For that, you must change your marital status by following these steps: “Services – IRS – Personal data relevant to IRS declaration – IRS aggregated data” and, in “Family Aggregate”, choose “Deliver communication”. Then, in “Data of taxable persons – Marital status”, you must select “Single, divorced, legally separated”, and finally “Submit”. Also read: Divorce and Home Loan: Let’s make it simple
In the case of dependents, should a division be made?
In case the ex-spouses have dependents under their care, when opting for shared custody, in the IRS declaration they can decide the percentage they want to deduct children’s expenses. That is, the total must represent 100%, and, for example, the mother can deduct 30% and the father the other 70%. For this, the ex-couple has to indicate the following changes: A current residence of dependents. That is, they must refer to the situation of alternate residence. It is mandatory that the two separated parents place the same situation regarding each dependent. If there is no agreement between the two, the Tax Authority may ask the parents to present the parental responsibilities regulation agreement and decide accordingly. A percentage each parent will deduct per dependent. In this sense, it is also necessary that the two agree. That is, if one puts that it will deduct 20%, the other must put the remaining 80%. If the sum is not 100%, the Tax Authorities divide 50-50 for each of the parents, so that both deduct half of the expenses.
How to change the status of dependents?
For change the status of dependents after a divorce, you should follow these steps: enter the Finance Portal with your access credentials, in the left sidebar, access “Services – IRS – Personal data relevant to IRS declaration – Aggregate data IRS – Communicate household”. Right away, change the data in the area “Dependants, dependents in joint custody and civil godchildren”choosing “Yes” in “Alternate Residence”. If it is not pre-filled, you must add the Tax Identification Number (NIF) of the other parent. If the dependent is not registered for the previous year, you must “Add dependent” and, if you need to make changes, “Open edit mode”. to register the sharing deductions from expenses select the field “Sharing expenses” and indicate the percentage of expenses that each parent will deduct. Remember that the percentage you enter must result in 100% when added to that of the other ex-spouse. Otherwise, automatically, each one will deduct 50%.
Dependents can only have a permanent home
Furthermore, in this process you have to indicate the permanent residence of the dependents, since they can only have one tax domicile. Despite having a alternate residence, dependents cannot belong to more than one household at the same time. This does not prevent them from being included in two individually taxed IRS returns. As a rule, dependents who are in shared custody belong to the household corresponding to the residence described in the agreement regulating the exercise of parental responsibilities. if you have the Automatic IRS, the data of the property corresponding to the permanent residence of the dependent are already filled in. But if you fill it in manually, in “Permanent housing of the household – Permanent housing data”, you must identify the property with the type, article, fraction and location, and “Submit” when finished. Finally, if you want consult the information, just follow the same path: “Services – IRS – Personal data relevant to IRS declaration – IRS aggregated data” and choose “Consult household”, being able to download a receipt. Read also: Capital gains: what to do in cases of inheritance or divorce
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