Did you know that your Miami family law case may entitle you to some tax deductions? If you are in the middle of a Miami divorce case or just finished one, as the year winds down and tax season approaches, it’s time to start thinking about what documents you need to help your accountant take advantage of the benefits allowable to you under the law.

If you do not know what expenses relative to your Florida family law case may give you a tax benefit, you may not know what questions to ask and/or what documents you should bring to your accountant. Here are some tips to get you started on the road to saving money:


  • Transfer of property generally not taxable: If you have a marital settlement agreement that divides property between you and your spouse, if there is gain or loss as a result of the transfer of property and debt between spouses, it is normally not recognized for tax purposes. However, if jointly owned property is sold, a spouse’s share of gain or loss on the property must be reported for tax purposes. Ask your divorce attorney for a copy of any agreements entered during the year with your spouse/former spouse and show your tax professional any documents related to the sale of property during the year.


  • Alimony (spousal support) generally taxable: Alimony is defined as a payment to or for a spouse or former spouse under a divorce decree or separation agreement. It is generally deductible by the payer and must be claimed as income by the recipient. There are some exceptions to this rule, and your accountant can help you determine if they apply to your situation.  If your spousal support payments end or decrease within the first three years of starting, they may be subject to the alimony recapture rule. This affects the deductibility of the alimony. Ask your attorney for copies of all court orders and agreements which specify how alimony is paid in your case and have this ready for your CPA.


  • Determine who can claim a child as a dependent: Unless you have a written agreement to the contrary, generally the custodial parent (the parent with whom the child lives most of the time) is who gets to claims the child for tax purposes. If the child lived with each parent for an equal amount of time during the year, the parent with the higher adjusted gross income is considered the custodial parent and, absent an agreement between the parents to the contrary, is entitled to claim for tax purposes. Ask your Miami family lawyer what documents you may be able to show your accountant to prove how much time your child lived with you throughout the year.


  • Understand what fees associated with your family law case are deductible: Generally, legal fees and court costs paid for getting a divorce are not deductible for tax purposes. However, legal fees paid for tax advice in connection with divorce and legal fees associated with getting alimony are generally deductible. Additionally, it may be possible to deduct for fees paid to appraisers and accountants for services in determining the correct tax or in helping to get alimony.  For this reason, it is important that you obtain from your Florida family lawyer your year-to-date itemized billing statements so that your tax professional can advise you as to what portion of your legal fees is deductible.


Get ahead of the game and don’t let those hard-earned dollars escape! For more in-depth and personalized analysis on how your own Miami family law case may benefit you for tax season, contact a Miami divorce lawyer at Streets Law for a personal consultation.