Taxes are already complicated, but significant life changes, like getting married, divorced, or having children, can make them even more confusing. Certified tax coach planning can help and is recommended during these types of milestones, but it’s also good to know what to expect. Here, we’ll go over some essential information on how marriage, divorce, or children can affect your taxes.
In this article, you’ll learn:
Marriage: Once you’re married, the IRS considers you and your spouse one tax unit. You’ll choose between filing jointly or separately, which affects your standard deduction, tax brackets, and eligibility for credits.
Divorce: After divorce, your filing status changes to single or head of household. Alimony, child support, and who claims dependents all impact your return. Property division and asset transfers may also carry tax consequences.
Children: Kids can unlock valuable tax credits and deductions, such as the Child Tax Credit, Earned Income Tax Credit, and Child and Dependent Care Credit. Parents may also qualify for education credits later on.
Different Ways Marriage, Divorce, and Children Can Impact Your Taxes
There are several different ways that significant life events can impact your taxes. Some of the most important changes occur during marriage, in the case of divorce, or if you and your partner welcome a new child into the family.
Marriage and Taxes: What Changes When You Tie the Knot?
Marriage is an exciting milestone in life that brings about a significant number of changes. One of the most notable (legal) changes is what you do during tax season. After being married, the Internal Revenue Service will view you and your spouse as one tax unit, which can bring both benefits and drawbacks depending on your income and overall situation. Some things to be aware of for the tax year after your wedding include the following:
Filing Status Options
Once married, you can no longer file as “single.” Instead, you’ll choose between:
Married Filing Jointly (MFJ): Most couples file a joint return because it usually leads to a lower tax bill. You’ll combine your incomes, deductions, and credits, which can push you into a more favorable tax bracket.
Married Filing Separately (MFS): This option is less common, but it may make sense if one spouse has significant medical expenses, student loan repayment considerations, or liability concerns. Be aware that filing separate tax returns can limit your eligibility for valuable credits and deductions.
Typically, when you file jointly, you get a higher standard deduction. In 2025, this is $30,000, double the single filer amount ($15,000). This reduces your taxable income and can lead to substantial savings. Additionally, joint filers benefit from wider tax brackets, meaning you can earn more income before moving into a higher tax rate.
Potential Tax Benefits and Drawbacks
There are several benefits of filing jointly, which include things like:
Education Credits: Couples may qualify for the American Opportunity or Lifetime Learning Credits.
Earned Income Tax Credit (EITC): Filing jointly may make you eligible for credits that single filers don’t always qualify for.
Gift and Estate Exemptions: Spouses can transfer unlimited assets to each other without triggering gift taxes.
The primary drawback of filing jointly occurs if you and your spouse both earn high incomes. This would significantly increase the tax bracket when compared to individual filing. To determine which option would lower the amount of taxes you have to pay, it’s best to receive personalized tax advice from a CPA.
Divorce and Taxes: Understanding the Financial Impact
Getting divorced isn’t easy. It affects everything from your personal life and family dynamic to your federal taxes and how you handle income. Understanding these changes before you need to file taxes can help save you from costly mistakes following a separation. Some of the most essential things to consider include the following:
Filing Status After Divorce
Once your divorce is finalized, you’ll typically file as:
Single: If you don’t have dependents, you’ll usually revert to filing as a single taxpayer.
Head of Household: If you support a qualifying child or dependent and meet IRS requirements, you may qualify for this filing status, which comes with a larger standard deduction and better brackets than filing single.
However, if the divorce isn’t finalized by December 31, the IRS still considers you “married” for that tax year. You can find more information on filing taxes after a divorce or separation agreement at the IRS website here.
Child Support and Alimony
Generally speaking, child support is not subject to tax law. This means it’s not considered taxable income and cannot be written off as a deduction. The circumstances surrounding alimony are a little more confusing and may be subject to tax depending on several factors. Ideally, it’s best to get legal or tax advice on this matter to ensure you receive advice based on your circumstances.
Dependents After Divorce
One of the most common tax questions after divorce is: “Who gets to claim the kids?” Generally, the custodial parent (the one the child lives with most of the year) has the right to claim the child as a dependent. However, noncustodial parents may claim the child if the custodial parent signs a release (Form 8332). If both parents try to claim the child, there is a tie-breaker rule that determines who receives the tax benefits.
Property Division and Assets
Splitting property may also lead to changes to your tax liability. If you’re going through a divorce, it’s essential to consult with a tax expert to determine the best interests of both parties involved. This may require a conjoined meeting with lawers, but it’s the best way to make sure that you get the most out of property division both in the short- and long-term. This is especially important when selling a home and dividing retirement accounts.
Children and Taxes: The Benefits and Responsibilities of Parenthood
Having children can also significantly affect your taxes. Yes, there are several potential opportunities for tax savings, but the rules surrounding these can be complicated. Some of the most important things to consider about how kids may change your taxes include the following.
Tax Credits for Parents
Children can unlock valuable tax credits that directly reduce your tax bill, dollar-for-dollar, in several ways. Some of the ways kids can lead to tax cuts and breaks include the following:
Child Tax Credit (CTC): For each qualifying child under age 17, you may be eligible for a significant credit that lowers your tax liability. In 2025, this is $2,200 for each qualifying child under 17.
Additional Child Tax Credit (ACTC): If the Child Tax Credit exceeds what you owe, you may receive part of the unused credit as a refund. The refundable portion is worth up to $1,700 in 2025.
Earned Income Tax Credit (EITC): Families with qualifying children may receive thousands of dollars back depending on income level and household size. You can find the current tables here.
Deductions Related to Children
There are also child-related costs that can help lower your taxable income and provide additional benefits. Again, if you’re unsure of these, it’s important to consult with a tax professional to make sure you’re staying compliant with the IRS. However, some things that you may be eligible for include:
Child and Dependent Care Credit: Helps offset daycare, babysitting, or after-school care expenses if both parents are working or looking for work. This can be up to 20% to 35% (depending on taxable income) of some of the childcare costs, up to $3,000 for one child or $6,000 for two or more.
Adoption Credit: A one-time credit for qualified adoption expenses, up to $16,810.
Education Benefits: Once kids are in college, parents may qualify for the American Opportunity Credit or the Lifetime Learning Credit to offset tuition costs.
To claim any child-related tax benefits, you’ll need your child’s Social Security number, proof of any related expense, and, in the case of divorce or separation, custody agreements.
Major life changes like marriage, divorce, or having children can significantly reshape your tax situation. You may need to file as head of household for the first time, or maybe you’re not sure about how to optimize tax deductions. While the above tax tips can help you get a better idea of what to expect after significant life changes, things can get complicated. If you’re facing a big life change and want a bit more peace of mind when filing your taxes, the professionals at Del Real Tax are here to help. Schedule a consultation or contact us today to learn more about how we can help with your individual or business tax return.
