14 Oct File Before December 31 or Wait? Understanding the Tax Implications of Divorce Timing in Texas
If you’re planning a divorce in Texas, timing matters, especially when it comes to your year-end tax status. While the IRS uses your marital status on December 31 to determine how you’ll file your taxes for that year, it’s important to understand that filing before December 31 will not finalize your divorce before year-end.
Texas law requires a minimum 60-day waiting period between filing and finalization. In reality, most divorces take longer due to court schedules, document exchange requirements, and negotiation time. Even in the smoothest, uncontested cases, September is generally the latest you can file if you want the divorce finalized by December 31.
Still, filing before year-end can start the process sooner, initiate financial disclosures, and help you plan strategically for the upcoming tax year. Deciding whether to file now or wait until January is a significant financial decision that’s best made with guidance from an experienced Texas divorce attorney.
1. Why December 31 Still Matters
Even if your divorce won’t be finalized by December 31, that date remains an important tax planning milestone.
If You’re Still Married on December 31
If a judge has not signed your final decree by midnight on December 31, the IRS still considers you married for the entire year. You’ll have two options:
- Married Filing Jointly – This often provides the biggest tax break, but it makes both spouses jointly responsible for the entire tax bill.
- Married Filing Separately – Keeps finances separate but often results in a higher total tax bill.
After Your Divorce Is Final
Once your divorce is finalized, you’ll file future tax returns as either:
- Single, or
- Head of Household (if you qualify under IRS rules).
While your marital status on December 31 determines this year’s taxes, starting the divorce process before year-end can ensure you’re ready to file as single for the next tax year and help you separate finances cleanly before the new year begins.
2. The Texas Clock: The 60-Day Rule
Under Texas law, a divorce cannot be finalized until at least 61 days have passed since filing. This mandatory “cooling-off period” allows both parties time to prepare their financial disclosures and finalize the agreements.
However, in practice, most divorces take 90–120 days or more. That means if you want your divorce finalized before the end of the year, you should file by September or early October at the latest. Filing later almost guarantees the final decree will be signed sometime in the following year.
Residency Requirements
Before you file, make sure you meet Texas residency laws:
- One spouse must have lived in Texas for at least six months, and
- One spouse must have lived in the county where you’re filing for at least 90 days.
If these rules aren’t met, filing too early or in the wrong county can delay your case. A local Texas divorce lawyer can ensure you file correctly the first time.
3. What Happens Once You File
Filing triggers a series of deadlines and responsibilities. Within 30 days after your spouse files an answer, both parties must exchange financial documents—a process called Initial Financial Disclosure.
You’ll need to gather:
- Two years of bank, credit union, and brokerage statements
- Retirement account statements (401(k), pensions, IRAs)
- Insurance policies and property ownership records
If you file in December, this process begins immediately, and the 60-day clock will carry into the next year. Starting early ensures you have the time to gather complete and accurate documentation without the pressure of the holiday season.
4. Planning Ahead for Retirement Accounts (QDROs)
If you or your spouse has a retirement plan, your attorney may need to prepare a Qualified Domestic Relations Order (QDRO) to divide those funds without triggering taxes or penalties.
The QDRO process can take several weeks, so filing in the fall rather than December helps you avoid delays. Even though the QDRO isn’t due by December 31, getting started early keeps the process moving smoothly once the decree is signed.
5. Should You File Now or Wait Until January?
Whether to file now or after the new year depends on your financial situation and how quickly you want to begin the process.
| ✅ Starts the 60-day waiting period sooner | ✅ Avoids holiday-season paperwork stress |
| ✅ Gives you a head start on next year’s tax and financial planning | ✅ Simplifies tax filing since you’ll be married all year |
| ❌ Unlikely to finalize before December 31 if filed after early fall | ❌ Delays the start of your 60-day waiting period |
| ❌ Requires immediate document preparation | ✅ More time to organize records and budgets |
6. Planning for Your Financial Future
Divorce affects every part of your financial life. Once your divorce is final, remember to update:
- Wills and trusts
- Insurance policies
- Retirement account beneficiaries
Getting organized now ensures a smoother transition, whether your decree is signed before or after the end of the year.
Need Legal Guidance Before Year-End?
Even if your divorce won’t be finalized by December 31, starting the process before year-end can put you months ahead in organizing your finances and preparing for the next tax season.
If you’re considering divorce in Texas, contact Navarrette Family Law today to schedule a consultation with an experienced Texas divorce attorney. We’ll help you determine the best time to file—and ensure your financial and legal strategy sets you up for a stable start to the new year.