Divorce and Separation Tax Considerations for 2020

At the start of a separation or divorce proceeding, both sides are typically focused on the division of assets as that’s always one of the more heated aspects of the negotiations.

Knowing the tax implications heading into these negotiations can help you understand which assets are financially worth fighting for and that you’ll come out financially ahead not just in the near-term but also when tax time rolls around.

Firstly, under IRS rules, you’re technically still married if your divorce is not finalized by the end of the current tax year. So if on Dec. 31 your proceeding hasn’t wrapped up, you’ll still be considered married and will likely continue filing jointly if you were doing that before the divorce.

Are There Benefits to Filing Jointly?

You can still claim the higher standard deduction as a couple, $24,800, whereas the 2020 “separate married return” deduction is $12,400, which is the same amount as a single filer. However, you’re also liable as a couple for all taxes owed, even if one spouse made more income than the other. If one spouse is delinquent on taxes, the IRS could come after the other spouse for monies owed. (For state taxes, Mississippi has seven years to collect any outstanding tax debt.)

Suppose there’s a clear delineation between debt accrued during the marriage and debt accrued outside of it. In that case, you may not be liable for that extraneous debt as Mississippi is not a “community property” state.

If joint back taxes are owed, the responsibility to pay those taxes can be split and negotiated during a divorce proceeding.

Filing as Head of Household

Technically, you can also file as head of household as long as you and your spouse stopped living together before the last six months of the tax year and you paid more than 50% of home maintenance costs for the same tax year. You’d also have to have a dependent and the right to claim said dependent. You’d need to file separately as well.

Other, more specialized tax issues for those with high-net-worth or considerable business assets could be split in a divorce.

In terms of house and other property, Mississippi courts typically try to divide property accrued during the marriage in an equitable manner. If that can’t be arranged, the court or an agreed party would sell the house/property and proceeds would be split between both sides.


With all of the financial implications at stake, it’s crucial to consult a qualified divorce attorney. Call the team at The Law Offices of Rusty Williard today at (601) 824-9797 to learn how we’ve advised Brandon and Jackson clients through difficult divorce negotiations.