West Virginia Divorce ~ Tax Concerns
During a divorce may questions can arise when it comes to things like taxes. Here are some tax facts that may assist you in your divorce proceedings.
In most divorce cases, the spouses agree to choose a spouse that may claim the child or children involved. In most cases parties choose to alternate years of legally claiming the children as dependants. Some disgruntled spouses file their taxes in a hurry and claim the children even if it isn't their year to do so. When the other spouse files and tries to claim the children, the IRS will immediately reject the second return. These things are never overlooked. It is very important to be clear about which spouse will be filing which years and it is best to have this negotiation prepared before your divorce goes to court so that it is legally binding.
Your filing status will determine the tax rate of each spouse. Usually a divorced person would file "Individual". If children are involved, whoever has physical custody of the child for over half of the current year may file "Head of Household". Qualifications for Head of Household include the physical custody of the child for over half of the current year and the filing spouse must have provided more than half of the costs to maintain their residence, must be unmarried, and the residence must be the home of the qualifying child.
In 1997, President Bill Clinton signed the Taxpayer Relief Act of 1997 and it became legally official. This act permits taxpayers to exclude up to $250,000 ($500,000 if filing jointly) of gain realized on the sale or exchange of a principle residence. If you have owned and occupied your residence for at least two of the five years prior to the sale of the residence may take advantage of this exclusion.
Source : West Virginia Code