Getting a divorce can be challenging, but when it comes to how to handle your money, The Balance can guide you through every step of the process. In this content hub, find the answers to all of your financial-related divorce questions.

Paying for a Divorce

people looking at glass tank of assets
Divorce and Money: The Most Common Financial Issues of Divorce in the US
Frequently Asked Questions
  • What does divorce mean for taxes?

    Your marital status impacts your filing status, tax rate, who can claim a child as a dependent, and more. The main tax-related difference to be aware of when going through a divorce is that you may be eligible for head of household filing status after a divorce is finalized, which will allow you to claim a larger standard deduction. Other things to think about include who will claim a child (if relevant) as a dependent, if you are still jointly liable for taxes, and whether or not you can deduct child support and alimony. Note that, for the IRS to consider you legally divorced, the divorce must be final by the last day of the tax year, Dec. 31.

  • What happens to debt when you get divorced?

    In most cases, the majority of debts incurred during a marriage will need to be divided in court during divorce proceedings. How debt—think credit card debt, a mortgage, auto loans, student loans, personal loans, and medical debt—is divided will largely depend on the state you live in and whether it’s a community property state or equitable distribution state. Before a divorce is finalized, it’s best to list all your debts (both individual and joint) and the amounts. Then, make a plan for paying off debts that works best for you.

  • How much does it cost to file for divorce?

    The sole cost of filing for a divorce will depend on the state (and sometimes county) you live in, but it generally falls in the range of $100 to $400. In New York for example, the filing fees will cost at least $335 if your divorce is uncontested. In addition to filing for a divorce, you will need to account for potential legal or attorney costs, expenses you will take on as an independent, and child support, if applicable.

  • Does divorce affect your credit score?

    Your credit score is not directly impacted by getting a divorce, rather from situations arising out of the divorce process. Account closures, missed payments, or higher debt balances due to divorce costs have the potential to lower your credit score. To protect your credit during a divorce, check your credit report from one of the three major reporting agencies, close joint accounts, review your monthly expenses, and maintain all payments.

  • How does money get split in divorce?

    The division of assets in divorce depends on a number of factors, including your state’s laws, the type of asset at hand, and whether the asset was acquired before or during the marriage. If you live in a community property state, property and debt acquired during marriage are usually subject to a 50/50 split. With common-law property, though, each spouse is entitled to sole ownership of certain items acquired during marriage.

  • Can two people claim the same dependent?

    Only one person can claim the same dependent on their tax return, and this person is considered the custodial parent. The custodial parent can claim tax breaks such as child tax credit, head of household filing status, earned income tax credit, and exclusion for dependent care benefits. However, both parents may still be able to take advantage of some dependent-related tax breaks if they decide to split the tax breaks.

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