Death, Taxes and Divorce: Why Tax Returns Are Essential in Family Law Cases in Middle Tennessee

Nothing is certain in life except death and taxes. I would add that it is also certain that a person’s federal income tax return will be asked for in a divorce case. These documents provide essential information in any divorce or parenting plan case!

First, and most readily apparent, tax returns provide definitive evidence of income from employment. Also, by reviewing the past two to five years of income tax returns can help establish patterns of income or earning ability.

Second, tax returns can verify or uncover the existence of additional assets. Income reported through investment income, dividend income, interest income, or investment income, such as rollover IRAs or qualified distributions can shed light on assets from investments that may otherwise be hidden.

Third, tax returns can provide a basis to review closely held businesses, providing information such as ownership percentages, gross and net earnings from the business, and business expenses. Self employment taxes are also calculated and are important when considering child support matters.

In addition to these quick three points, knowing the various schedules help attorneys quickly find expenditures such as charitable giving patterns, mortgage interest payments, daycare expenses or tuition credits for dependents, and Health Savings Accounts or healthcare costs.

Nothing is certain in life, except death and taxes, but your tax filings will certainly be necessary documents in your divorce and parenting plan.