Hi folks,
Like many of you my divorce was final in 2004 and I ended the year as a legally single man.

Also, like many of you we have interest and investment income that we earned under both our names in 2004.

Anybody have any idea how this is handled on a return. I am NOT looking for specific advice, just information on what you did, or where to get such information.

Although I usually do my own taxes; the year I was divorced I had mine professionally done because of questions like that and concerns that my ex might not be totally honest. The extra money was worth the peace of mind.

I filed Single head of household, using all information on my tax return.

You could file Married filing seperate, or married filing jointly for that last year of marriage if you think you'll see any of it.

But you could do what I did and file Single head of household.

Do you have kids? If so, did you work something out in your divorce documents as to who claims the kids?

Because if not, and she files first as single head of household and claims your children, you won't be able to.

My ex-h and I worked it out in our divorce papers that I claim two and he claims one.

Well, though my divorce was final last year, the taxes this time around aren't really an issue, since we already had everything separated, and there was nothing in both our names anymore.

Our 2003 taxes, however, were probably similar to what you are dealing with for 2004. I insisted on filing married filing separately, because I didn't trust XH enough to file joint with him.

In our case, I took all the deductions (house, real estate taxes, donations) and claimed all the interest from joint bank accounts as well. That's because, in our case, I was the one paying for everything, and the only one putting money in any joint accounts anyway. I wanted to make sure I was covered if he decided to protest the way I was handling it, so I really researched what the IRS says on the matter. Basically, it says that the person who paid out whatever gives you the deduction is the person who is allowed to take it on the taxes, and the person who made the money is supposed to claim it as income, etc.

So, in our case, me putting all of it on my taxes was what was fair. I believe the split can be however the two of you agree - 50/50, one of you put all of it on your return and the other put none of it, or anywhere in between. As long as the total between the two of you comes out to the full amount of what was earned. Another good thing here is, other than determining how you split that income, you don't have to coordinate your taxes. For married filing separately, if one person itemizes, both must itemize. But since you are both filing single, one of you can itemize, and the other can still take the standard deduction.

I found all my information on the irs.gov website. It's all in the tax code, it's just a royal bear to figure it out. The situation I was figuring out was very simple - just real estate taxes, mortgage interest, charitible deductions, and interest income. Still, I had to read all the pertinent documents several times to make sure I was understanding it all correctly.

If your investments are fairly simple and straightforward, you can probably figure it out just reading the irs site. And I always use one of the tax programs - they really do a good job of covering this stuff as long as its not too complicated. But if you aren't sure, or just want to be extra-careful, go to a tax preparer.

Oh, and TR, my understanding is that you don't really have a choice about filing status. The year in which you are divorced you are considered single.

Good luck Justin... I hope things are civil enough with you and your XW that you can come to a reasonable agreement on it.

</font><blockquote><font size="1" face="Verdana, Arial">quote:</font><hr /><font size="2" face="Verdana, Arial"> Oh, and TR, my understanding is that you don't really have a choice about filing status. The year in which you are divorced you are considered single.
</font><hr /></blockquote><font size="2" face="Verdana, Arial">That is correct. If you were officilly divorced on 12/31/04, you may NOT file MFJ or MFS even if you were considered married during the year.
You must file Single, or HOH if you have a dependent.

Were your investment accounts split 50/50 in the final settlement and divorce decree?

If so, I would contact the financial institution, provide them with a copy of the divorce decree and ask them to reissue corrected 1099 INT's in both of your names with the interest divided.

<small>[ February 14, 2005, 12:51 PM: Message edited by: Faith1960 ]</small>