Monday, July 31, 2023

Tax Tip 2023-97: Tax considerations for people who are separating or divorcing

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Issue Number:  Tax Tip 2023-97

Tax considerations for people who are separating or divorcing

When couples separate or divorce, the change in their relationship status affects their tax situation. The IRS considers a couple married for tax filing purposes until they get a final decree of divorce or separate maintenance.

Update tax withholding
When a taxpayer divorces or separates, they usually need to update their proper tax withholding by filing with their employer a new Form W-4, Employee's Withholding Certificate. If they receive alimony, they may have to make estimated tax payments. Taxpayers can figure out if they're withholding the correct amount with the Tax Withholding Estimator on IRS.gov.

Tax treatment of alimony and separate maintenance

  • Amounts paid to a spouse or a former spouse under a divorce decree, a separate maintenance decree or a written separation agreement may be alimony or separate maintenance for federal tax purposes.
  • Certain alimony or separate maintenance payments are deductible by the payer spouse, and the recipient spouse must include it in income.

Rules related to dependent children and support
Generally, the parent with custody of a child can claim that child on their tax return. If parents split custody fifty-fifty and aren't filing a joint return, they'll have to decide which parent claims the child. If the parents can't agree, taxpayers should refer to the tie-breaker rules in Publication 504, Divorced or Separated Individuals. Child support payments aren't deductible by the payer and aren't taxable to the payee.

Not all payments under a divorce or separation instrument – including a divorce decree, a separate maintenance decree or a written separation agreement – are alimony or separate maintenance. Alimony and separate maintenance doesn't include:

  • Child support
  • Noncash property settlements – whether in a lump-sum or installments
  • Payments that are your spouse's part of community property income
  • Payments to keep up the payer's property
  • Use of the payer's property
  • Voluntary payments

Child support is never deductible and isn't considered income. Additionally, if a divorce or separation instrument provides for alimony and child support and the payer spouse pays less than the total required, the payments apply to child support first. Only the remaining amount is considered alimony.

Report property transfers, if needed
Usually, if a taxpayer transfers property to their spouse or former spouse because of a divorce, there's no recognized gain or loss on the transfer. People may have to report the transaction on a gift tax return.

More information:
Topic No. 452 Alimony and Separate Maintenance

 

 

 

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Friday, July 28, 2023

IR-2023-137: IRS selects new Chief Transformation and Strategy Officer to lead change efforts under the Inflation Reduction Act; David Padrino to oversee Strategic Operating Plan work to help taxpayers, drive agency improvements

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Issue Number:    IR-2023-137

Inside This Issue


IRS selects new Chief Transformation and Strategy Officer to lead change efforts under the Inflation Reduction Act; David Padrino to oversee Strategic Operating Plan work to help taxpayers, drive agency improvements

WASHINGTON – Today, the Internal Revenue Service announced the selection of David Padrino to serve as the Chief Transformation and Strategy Officer, a recently created role at the agency that will spearhead improvement efforts under Inflation Reduction Act funding.

Padrino joins the IRS after serving as Chief Transformation Officer at the federal Office of Personnel Management (OPM). He has spent more than two decades working in a variety of other leadership roles across local, state and federal governments as well as on transformation efforts in the private sector.

"David brings critical experience and insight that the IRS needs to help transform the agency and make improvements for taxpayers at a critical time for our nation's tax system," IRS Commissioner Danny
Werfel said. "He will work closely with our IRS leadership teams to focus on making short-term and long-term improvements called for under our new Strategic Operating Plan. With his long track record of success, David will be a key part of our efforts to help the IRS move forward on essential taxpayer service improvements, compliance changes to ensure fairness and strengthening IRS technology to serve taxpayers."

Padrino has an extensive background in transformation efforts, ranging from work with Fortune 50 corporations in the private sector to a variety of roles across government.

"I am excited to join the IRS during this critical period of transformation and work alongside so many dedicated public servants," Padrino said.

Since last year, Padrino served as OPM's Chief Transformation Officer, where his work included rolling out an agency-wide transformation effort. Prior to that role, he worked in 2021 and 2022 at OPM to help revitalize the Office of Human Capital Data Management & Modernization.

Padrino's previous roles covered a range of activities. He served as the Chief Recovery Officer for the Colorado Attorney General in 2020 and 2021, working on pandemic response efforts including broadband access issues for Colorado schools.

From 2014-2019, Padrino worked with then Colorado Gov. John W. Hickenlooper, serving as Chief Performance Officer as well as Chief of Staff to the Lieutenant Governor and Chief Operating Officer. Padrino led a number of initiatives to improve government service delivery, which ultimately led national non-profit Results for America to name Colorado one of the best states at using data and evidence to deliver results for residents.

Prior to that, he worked in the private sector with the Boston Consulting Group from 2007-2014. During this period, his extensive portfolio included working on more than 25 projects in 10 countries, where he served clients across the private, public and non-profit sectors, including the technology, consumer goods, financial services and health care industries.

Padrino graduated from the Wharton School at the University of Pennsylvania with a Master of Business Administration and received a Bachelor of Arts degree from Vassar College.

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Dueños de casa: revisen estas deducciones y programas relacionados al hogar

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Dueños de casa: revisen estas deducciones y programas relacionados al hogar


Los meses de verano son un tiempo popular para comprar o vender una casa. Los nuevos dueños de casa deben añadir el revisar las deducciones de impuestos, programas y subsidios relacionados al hogar a los que pueden ser elegibles, a sus listas de quehaceres para mudarse.

Gastos deducibles relacionados al hogar

La mayoría de los compradores de casas piden un préstamo hipotecario para comprar sus casas y luego hacen pagos mensuales al titular de la hipoteca. El pago puede incluir varios gastos relacionados con ser dueño de una casa. Los gastos que un dueño de casa puede deducir son:

Contribuyentes deben detallar sus deducciones para poder deducir los gastos relacionados a ser dueño de casa.

Gastos y pagos no deducibles

Los dueños de casa no pueden deducir los siguientes artículos:

  • Seguro que incluye para incendios y cobertura contra todo riesgo y seguro de título de propiedad
  • La cantidad aplicada para reducir el principal hipotecario
  • Salario pagado para ayuda doméstica
  • Depreciación
  • Gastos de servicios públicos, como gas, electricidad o agua potable
  • La mayoría de gastos de cierre (en inglés)
  • Depósitos perdidos, pagos iniciales o depósito en garantía
  • Servicio de Internet o sistema wifi
  • Tarifas de asociación de dueños de casa, asociación de condominios o cargos comunes
  • Reparaciones en el hogar

Crédito de interés hipotecario

El Crédito de interés hipotecario ayuda a personas con ingresos bajos ser dueños de casa. Aquellos que sean elegibles pueden reclamar el crédito (en inglés) cada año por parte del interés hipotecario pagado. Un dueño de casa puede ser eligible para el crédito si se les emitió un Certificado de crédito hipotecario (MCC, por sus siglas en inglés) elegible de su gobierno estatal o local. Un MCC se emite solo para una nueva hipoteca para la compra de un hogar de uso principal.

Fondos de asistencia para dueños de casa

El programa de Fondos de asistencia para dueños de casa (en inglés) provee asistencia financiera a dueños de casa elegibles para pagar ciertos gastos relacionados a su hogar principal y prevenir morosidad hipotecaria, impago, pérdida de servicios públicos o servicios de energía en el hogar y también para el desplazamiento de dueños de casa que pasaron por dificultades financieras después del 21 de enero de 2020.

Subsidio de hogar para ministros y militares

Ministros (en inglés) y miembros de los servicios uniformados (en inglés) que reciben un subsidio de hogar no sujeto a impuestos todavía pueden deducir sus impuestos de bienes inmuebles e interés hipotecario. No tienen que reducir sus deducciones a base de su subsidio.

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