Do I Need to Pay My Spouse’s Tax Debt?

Understanding What Is Considered Community Property and Debt

When California couples divorce, their community assets and debts are typically divided equally between the two parties. These properties and dues are considered community if they were acquired during the marriage. Certain separate assets are exempt from such division if they were earned before the marriage or through income from those individual properties. Tax debt can fit into either category, sometimes becoming the shared responsibility of the spouse, while other times continuing to hold just one party liable.

Tax Debt Acquired Before Marriage

If your soon-to-be-ex has any outstanding tax debt from returns that were filed before you were married, you have no obligation to pay that debt. If you filed individually that year and the IRS has mistakenly intercepted your refund to account for your partner’s debt, you could potentially qualify for injured spouse status. If you filed jointly and had your refund withheld for their owed fees, you can get that money back.

Tax Debt Acquired During Marriage

If your spouse owes taxes from a filing during your marriage, you are potentially liable. Your responsibility to assist in repaying your former partner’s taxes from your marriage depends on:

  • If you are still together
  • If you benefited from the inaccurate return
  • If you were aware of the filing issues

In this scenario, you would be ineligible for a refund from the year of the understated filing. If you are able to prove ignorance, you may qualify for innocent spouse status and benefit from forgiveness on your owed back taxes. In order to qualify for innocent spouse, you must be able to prove that you had no way of knowing that you partner falsified the filing.

Tax Debt Acquired After Marriage

Individuals may dismiss liability if they are no longer married, either through divorce or legal separation, or had been living separately for at least one year preceding the claim by qualifying for separation of liability relief. This will clear you of any responsibility from a filing where they incorrectly filed jointly.

For further assistance with debt and property division as it applies to your specific case, contact Alternative Divorce Solutions.