Question about filing taxes after divorce

snipped-for-privacy@cox.net (The Jew) posted:

If you're asking about a refund for overpaid or overwithheld federal taxes, there is no tax consequence for that, since it is not considered to be income, for _federal_ purposes.

However, the federal tax refund might come into play as an item on any _state_ income tax return -- and any state tax _refund_ would be an issue on both of your next years' federal returns.

As long as the total amount of the refund is accounted for between your two separate returns, there should be no problem. Now that you have identified this as an issue, you could simply add this to your itemized lists of "divorce settlement agreements" -- either to split such items

Bill

The answer depends on where you live:

Community property state: 50% each - by law (unless you also got married in the year the refund is for).

Other states: See the other response that has posted before mine.

I am in Arizona which I believe is a community property state. So is it the law that it be split 50/50?

Thanks in advance!

Until it stops being community property, which I understand occurs when the couple splits, even in not yet divorced.

Not true. Marital community ends when the couple have a court order or a signed separation agreement ending the community. Ceasing to cohabitate will not end the community.

According to Pub 555, "In some states, the marital community ends when the spouses permanently separate, even if there is no formal agreement. Check your state law."

I've been told that is the case in California, but can't find a specific cite.

-Mark Bole

what if some of the income for that year was separate property?

I don't know about Arizona in particular, but life is generally more complex than this.

The Significance of the Separation Date Community property begins to accrue on the date of marriage and ends when the marriage is officially over. The date upon which a marriage is officially over is determined by state laws and may occur on any of the following dates:

a.. The date of "legal" separation b.. The date of "physical" separation c.. The day the Petition or Complaint is filed and/or assigned a case, docket or index number d.. The date the judge or commissioner grants your divorce, dissolution or legal separation e.. The day your divorce agreement or judgment is filed f.. The day you and your husband choose or a judge or commissioner assigns It is common for husbands and wives to fight over separation dates. Their disagreements are usually financially motivated and can significantly affect the size of a divisible community estate. For example, if a husband is the primary breadwinner and his wife a stay-at-home mom, he may want to establish an earlier date of separation because his wages, income and bonuses earned after the date of separation will be characterized as his separate, not community, property. His wife may, however, want to establish a later date of separation to maximize the divisible community estate. There are a number of criteria used to determine the actual date of separation and if a party wishes, he or she may ask the court to schedule a date of separation trial or hearing, where each spouse puts forth evidence to convince the judge or commissioner that his or her proposed date of separation is correct.

not yet divorced.

However, see also IRC Section 66 for nonrecognition of CP. That can occur PRIOR to the divorce being final.

My reply was specific to AZ.

In California property only belongs to the community when it is earned by one of the spouses while they are both married and living together, or are separated but not permenantly (in their subjective opinions).

See Family Code §771.

Stu