My husband owes back taxes. Am I liable?

August 18, 2022 by Steve Banner, EA, MBA
Woman looking at debt letter

It does not sound very fair that you should be liable for the back taxes that your husband owes. You each have your own job, and you each pay your own taxes from every paycheck. So why should you have to suffer just because he did not do the right thing and pay his taxes?

It is hard to argue with the above sentiments, but the reality is that it can be quite challenging to resolve cases like this – it all depends on the facts and circumstances.

Let us begin with the tax return where the problem first became known. If the couple, in this case, filed a joint return (they used the Married Filing Jointly filing status), then the tax law says they have “joint and several liability.” In other words, both spouses are responsible for the entire tax liability. This applies not only to the taxes shown on the return, but also to any additional tax liability that the IRS may determine to be due. This additional liability may result from the actions of a taxpayer’s spouse or former spouse, and the IRS can still collect from the taxpayer even after the couple is divorced. To make matters worse, joint and several liability make taxpayers responsible for their spouses’ legally-enforceable debts caused by past-due federal taxes, state income taxes, state unemployment compensation debts, child or spousal support payments, and other federal nontax debt, such as student loans. In effect, this means that in some cases, it is possible for one spouse to be held responsible for payment of all tax due - even if the other spouse earned all the income.

Fortunately, the tax code offers relief from the negative impacts of the joint and several liability provisions when the spouse feels that, to apply these provisions would be unfair, and that he or she is being impacted through no action(s) of his or her own. A taxpayer in this position can seek relief by applying to participate in either the Innocent Spouse program or the Injured Spouse program, depending on the circumstances of their particular situation. These programs are designed to help the taxpayer in question, but he or she must provide detailed information to the IRS about the case so that the IRS can determine whether the taxpayer qualifies for relief. The Injured Spouse Program is most often used when filing a current year tax return, while the Innocent Spouse Program is most often connected to issues arising after the original tax return was filed.

It can be exceedingly difficult for taxpayers to manage their application for relief on their own because of how both personal and tax issues are intertwined in their case. However, TaxAudit offers a representation service to assist taxpayers in this position, as well as provide a confidential, cost-free, obligation-free consultation with an experienced tax professional to help taxpayers understand the options open to them in their particular case.

More information about IRS relief programs and the related services offered by TaxAudit can be found in this short video presented by one of our leading tax attorneys.

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Steve Banner, EA, MBA
Tax Content Developer

 

Steve Banner began his career in the field of income tax in 1977 and has since gathered business experience in a variety of countries and cultures. In addition to the United States, he has lived and worked for extended periods in Australia, Saudi Arabia, Canada, and Sweden. Along the way he studied Adult Education and earned a Bachelor of Education, Master of Educational Administration, and MBA. He joined TaxAudit in 2016, where he is a Tax Content Developer.


 

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