| How
should you file — single, joint, or married filing separately
— for federal income tax purposes during the pendency of
your divorce/separation proceedings? In general, your filing
status depends on your marital status, and your marital status
depends upon your status under state law.
If, as of the end of the tax year, there has
been issued a “final” decree of divorce or you are
legally separated under a “final” decree of separate
maintenance, then you are no longer married and must file
as a single person (except that if you live with one or more
children and pay more than half the cost of running the household,
you may qualify for head of household filing status). It’s
not always clear whether a particular court action is final
or not.
If, as of the end of the tax year, there has
been no “final” decree of divorce, annulment or
separate maintenance, then you are still considered as married
even if you are separated from your spouse under a separation
agreement or a non-final court decree. You therefore must
file either a joint return or as a married individual filing
separately. However, a special rule permits you to be treated
as unmarried for filing status if:
 you
don’t file a joint return for the year;
you
maintain as your home a household which, for more than half
the year, is the principal residence of a child;
you
furnish more than half of the cost of maintaining that household;
and
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during
the last six months of the year, your spouse isn’t a
member of that household.
Be aware that if you are treated as married under the above
rules (that is, there has been no final court decree and you
don’t qualify under the special rule discussed above)
you still may want to file separately. For one thing, if you
made deductible alimony payments, you must file a separate
return in order to claim the deduction. The deduction can’t
be taken on a joint return.
Also, both spouses are generally liable
for the tax if a joint return is filed. This means that if
IRS audits the return and determines a deficiency, you could
be liable for all the additional tax, interest and penalties
even if the problems with the return related to your ex-spouse.
In that event, however, you may be relieved of liability for
a tax understatement that is attributable to erroneous items
of your spouse if you didn’t know or have reason to know
about them, meet some other requirements, and elect relief
within two years after IRS first tries to collect the tax
from you. Once you are divorced or legally separated (or you
and your spouse have not resided in the same household for
a full year) you also may elect to limit your liability for
joint returns you have already filed to the portion of the
tax deficiency that is allocable to you. To qualify, you must
not have actually known of the deficiency when you signed
the joint return, and elect this relief no later than two
years after IRS begins collection activities.
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