How the 2019 Tax Laws Will Change Divorce
At the end of 2017, the one thing everyone seemed to be talking about was the Tax Cuts & Jobs Act. More specifically, everyone was worried about how the new Act would affect the treatment of alimony. At the end of 2018, the deductibility of alimony for payors ended, as did the inclusion of alimony as income for recipients. As a result, people scrambled to get their divorces completed before the Act came into practice. Now that it’s 2019, it’s time to talk about what these changes really mean for families seeking a divorce.
How Will Families be Affected?
The Tax Cuts & Jobs Act eliminated all individual tax exemptions and instead, individuals get a higher standard deduction applied to their total taxable income. For couples with children, divorce has become more complicated in the following ways:
- A dependent child no longer qualifies as a tax exemption
- The child tax credit has doubled from $1,000 to $2,000 for each full-time legal dependent child under the age of 17
- An additional family tax credit of $500 for each dependent child over 17
Clearly, these new laws give divorcing parents even more to take into account, especially where finances are concerned.
At Shah & Kishore, we specialize in divorce, placing extra importance on cases where children are involved. These new laws will complicate the divorce process, causing extra stress on parents. Shah & Kishore can help you figure out your options and achieve a peaceful separation.