filing taxes for year of separation - use of spousal tax credit allowed?

[DanTess]

Hey all, here's the facts:

Decided in July it was over. Put house up for sale within weeks, it closed Dec 1st. Separation agreement decided and finalized Dec 5th (both signed with witnesses). Very amicable. Lived together until it sold. Physically living apart as of Dec 1st. She only worked 2 months of this past year (8 weeks). She said she'll let me use her spousal amount for my taxes since I was paying for everything for 11 months. I can even state that I'm living with her until Dec 31st if it makes it easy for tax purposes. All mail redirected to her new address (I'm in a temporary location so it was convenient to do that).

(In Ontario) What are my best options for making sure I can use her spousal amount as a tax credit? I think it's 11k minus the 2k she actually made last year so a 9k tax credit would be sweet. I'm not suggesting I want to lie on my taxes though, just take the best course of action.

Regards,

Dan

[DanTess]

Directly from the CRA: "We consider you separated when you live separate and apart from your spouse or common-law partner for a period of 90 days or more due to a breakdown in your relationship. Separation of less than 90 days is not considered a legal separation under the Income Tax Act. Once you have been separated for 90 days, the effective day of your separated status is the day you started living separate and apart. If you continue to live together in the same household, we will not consider separation to have occurred. An exception to this may occur when separate living quarters are self-contained in the same household."

Does this mean I can still put 'married' on tax return and claim full amount of spousal credit? (it's under 90 days)?

Dan

[dadtotheend]

You can still claim the spousal amount in the year of separation.

[BitHunter]

DDTE,
Source?

and how about the dependent child?

[Pharah]

Rszalai: This is all I could find on the topic. If this doesn't answer your question, call the CRA for more information.

Frequently asked questions about marital status

[dadtotheend]

DDTE, Source?

Source? I'm an income tax accountant

See General Income Tax and Benefit Guide - 2009 : Federal non-refundable tax credits (Schedule 1) which says:

You can claim this amount if, at any time in the year, you supported your spouse or common-law partner (see Marital status) and his or her net income (line 236 of his or her return, or the amount that it would be if he or she filed a return) was less than $10,320.

The statement at any time in the year covers the year of separation.

[BitHunter]

Thanks!
we separated in march. how would I know if she made less than $10,320 or not?

[Pharah]

I'll have to remember that DTTE

[DanTess]

Thanks!
we separated in march. how would I know if she made less than $10,320 or not?

you can't claim it without her knowledge/consent because she might use it herself if she did have income after you separated - you don't want to both try to claim it.

[DanTess]

You can still claim the spousal amount in the year of separation.

regarding the 'must be living apart for 90 days' thing, we started living apart Dec 1st, so what do i put for marital status when i file my return? married or separated? technically, as of dec 31st, they don't consider us separated yet...?

Dan...

[dadtotheend]

you can't claim it without her knowledge/consent because

Yes you can.

There's no requirement for her knowledge/consent. You just don't know what her income is.

So you might estimate and let them true it up later if/when she files.

[dadtotheend]

regarding the 'must be living apart for 90 days' thing, we started living apart Dec 1st, so what do i put for marital status when i file my return? married or separated? technically, as of dec 31st, they don't consider us separated yet...?

Dan...

As long as the separation lasted 90 days from December 1, you are separated as of December 31 and you enter separated for you marital status.

It doesn't have to be 90 days within the taxation year.

[DanTess]

ok, i'm confused. if i actually file my taxes on february 1st, it's only been 60 days, so technically i'm NOT separated yet - my point is though that i can claim it ALL because dec 31st is only 30 days after the physically apart time so i shouldn't have to figure out a percentage of the year that i can claim right?

if i enter separated on the tax form, will i have to go through hoops just to get the whole amount as a write off?

[dadtotheend]

There is no % involved.

It doesn't matter how many days in the year you are separated, so as long as the separation lasts at least 90 days.

If you are confident that you will stay separated for another 30 days on February 1, go ahead and file as separated.