Yes, You Need to Agree With Your Estranged Spouse When It Comes to Tax Filing

Q: I have been separated from my wife since November 1995. I filed for divorce earlier this year. My court date isn’t until next year, so my divorce won’t be final until 1997. What are my income tax filing options for 1996? Do I have to file as “married, filing separately,” or is there another status for people like me?

--D.P.

A: The news here isn’t pretty. At this point in the year, your options are slim. Unless you are single or have a legal separation agreement, you are not entitled to file a tax return as a single person.

Practically speaking, you have three choices: filing a joint return with your wife; filing as “married, filing separately”; or, if you have children living with you and/or under your support, filing as “head of household.”

Although it’s technically possible for you to still get a decree of legal separation before the end of the year, the likelihood of your being able to meet all the necessary court and filing deadlines in the next two weeks isn’t great.

Let’s look, with the help of family law specialist Violet Woodhouse in Newport Beach, at each remaining choice. If you and your wife can agree to it, you may still file a joint return, since you technically are still married. The two of you can also decide to file as “married, filing separately.” Either way, Woodhouse stresses, you must agree to file in the same fashion.

What you decide may well depend on your incomes and deductions, and absent more specific information, we can’t make a recommendation. Generally speaking, however, if your financial situations are relatively equal, you’re probably better off from a financial standpoint to file a joint return, our experts say. If they’re not equal, the spouse earning less will obviously face a smaller tax bite.

If you elect to file separately, remember that each of you must report not only your individual income, but also half of any income generated by assets you still hold (pending the final divorce decree) as community property. Failure to report both shares of this income could trigger an audit. In fact, our experts recommend that couples filing as “married, filing separately” attach a copy of the spouse’s return to their own tax filing to show the IRS that income from jointly held assets is being properly reported.

If you have children residing at home, either one of you may file as the head of the household, assuming you have been living in separate households for at least the last six months of the year. Presumably the parent in whose home the children reside gets to claim this status.

But there is no absolute rule about this, and either spouse--but only one--may claim it for any individual tax year. Even after your divorce, the two of you may decide to alternate which of you files as head of household; one can do it one year, the other in the next year.

Finding Employer Bought Out Long Ago

Q: I began working for Sperry-Rand Corp. in 1957 and left in 1971 after becoming vested in its retirement plan. I forgot about this pension until retiring a few months ago and running across some paperwork. The problem is finding the company, since it has been merged and dispersed over the years. As best I can tell, my group is now part of Honeywell Sperry Commercial Flight Systems. How do I find out whether the retirement program I am, or was, a part of still exists and will pay me my pension?

--K.E.C.

A: Sperry-Rand alums have a rich corporate history that includes, thanks to several mergers and acquisitions over the years, the Honeywell, Burroughs and Unisys corporations. According to our research, your pension records should be housed with Unisys Corp. in Blue Bell, Pa. You can call it at (800) 356-4982, or write to its retirement administration services office at P.O. Box 500, Blue Bell, PA 19424. Be prepared to give your Social Security number, dates of employment with Sperry-Rand, your address and, if you’re married, your spouse’s date of birth.

Having answered your question, the next issue is whether you, or anyone else with a similar question, could get this same information on his or her own. The answer is yes. Let’s detail the steps we took.

First we tracked down Honeywell Sperry Commercial Flight Systems in one of several business directories available in most local public libraries. We called there in Glendale, Ariz., and found that pension records for Sperry-Rand employees stayed with Unisys when that company sold your former division (which had become a part of Burroughs Corp. in September 1986) to Honeywell in December 1986. (By the way, and just to make matters a little more complicated: In the three months between the time Sperry merged with Burroughs and your former unit was spun off, Burroughs changed its name to Unisys.) Anyway, a Honeywell employee benefits worker gave us the toll-free number listed above, and we called it to verify that indeed the records in question were there.

In general, former employees of companies that have been through myriad takeovers and mergers should be able to get the kind of information you’re seeking by calling the company surviving the last known combination. According to Prudential American Securities in Pasadena, which researches corporate and stock histories for $40 per search, the best sources of the type of information you sought are “Capital Changes,” published by Commerce Clearing House, and “Directory of Obsolete Securities,” published by Financial Stock Information Inc. The former book is available in most public libraries; the latter is not, but if you have a friendly stockbroker, you may be able to get the information from him or her. By the way, these directories include only publicly traded companies.

If after trying our method you can’t figure out what happened to your former employer’s pension plan, you may contact the Pension and Welfare Benefits Administration at (818) 583-7862. Be warned, however, that this agency can’t do the basic research as fast as you can using the resources outlined above. But if you hit a roadblock in your search, it may be of help.

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Carla Lazzareschi cannot answer mail individually but will respond in this column to financial questions of general interest. Write to Money Talk, Business Section, Los Angeles Times, Times Mirror Square, Los Angeles, CA 90053. Or send e-mail to carla.lazzareschi@latimes.com