Is there any way to alleviate the impact of divorce on tax returns?

Question

My friend got divorced towards the end of 2016, and it seems she owes a lot more than she was expecting because her filing status is now Single.

She went through all the options she could find in TurboTax to see if she was missing any deductions she could take, but apparently that didn't help.

This seems to be effectively a financial penalty on divorcees, especially since a divorce late in the year will retroactively invalidate your income tax-withholding rate, which I believe isn't something many people plan for. Since the filing status only depends on the last day of the tax year (i.e. if you are divorced on December 30th, you must file as Single), it seems like it would be beneficial to postpone legalizing a divorce until the beginning of the year.

So, since it's too late to postpone the divorce, is there any way to alleviate the financial impact of the change in filing status?

I'm not asking about generic tax benefits that might apply; I'm asking for tax laws specifically related to marriage and divorce. Specifically:

• Is there any tax benefit to be gained from having been married for most of the year, even when you're divorced as of the 31st of December?
• Does divorce itself have any "hidden" tax benefits?

EDIT: Should have mentioned that my friend is filing her United States Federal income tax returns.

Answer 1

You might have her use the calculator found here.

The situation you describe suggests that her ex-husband was shouldering the majority of the family tax burden. Or that she was earning a much higher amount than he was. As an example a household income of 20K/100K split in income increases the tax burden for the higher earning spouse increases 3K.

There is really not much hidden or unknown for the things you are speaking of and generally speaking many tax issues are pretty straightforward. Once you start diving into business deductions and the like things might start to get hairy, but that is not the case with the situation you outlined.