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Single parent tax issues

At the end of a marriage, Virginia parents work through divorce legal issues that affect their children such as child custody and child support and visitation plans. Decisions about these issues could have an effect on taxes.

Head of household status, which can allow a lower tax rate and higher deductions, may change after a divorce. A single head of household for tax reasons must be unmarried on Dec. 31, 2014, earn 50 percent or more of the household income and have the children live with them at least six months of the year. The parent who can claim the child as a dependent usually is determined at the time of the divorce.

Some deductions and credits phase out with an income of $75,000. The exemption for one dependent child is a maximum of $3,950 for tax year 2014, which can't be split. A $1,000 tax credit could be available for each child 16 or under on Dec. 31. A qualifying childcare deduction can be up to $3,000 for one child and $6,000 for two children for heads of households. If available, single heads of households can contribute up to $5,000 tax free to a dependent care spending account for childcare. Depending on the number of children and income, a single parent might be eligible for a maximum earned income tax credit of $6,143. An adoption finalized in 2014 could allow up to $13,190 in federal tax credits.

A lawyer could help with divorce issues such as property division, child custody and support. In addition, a lawyer may help with divorce modifications and resolution of disputes. Resolving child custody and support are common reasons for modifications that may have tax consequences for single parents.

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