Should I Sign That Joint Tax Return

As some of you procrastinators may be aware, the October “tax season” just ended. As a result, in the last few weeks I was asked numerous times to evaluate whether or not one of the spouses undergoing a marital dissolution should sign a “married filing joint” tax return prepared by their spouse (or their spouses advisors).  The reason this question gets asked so often in these situations is because the spouse who did not prepare the joint return is afraid that the spouse who prepared the return may have understated the income or perhaps overstated deductions.   Continue reading

Reporting Income and Deductions on Separate Returns

If married spouses elect to file separate returns (see previous post re Filing Status While in Process of Divorce), each spouse should report only their own income, exemptions, deductions, and credits on their individual return (Reg. 1.66-1).  This reporting may be easier said than done, however.  It may not always be clear who owns what investment and its income stream and who paid and is eligible for which deductions.  The situation may be even more complicated if the spouses live in a community property state such as California. Continue reading