Are there any disadvantages to filing married filing seperately?

Question

I've recently split up with my soon to be ex-husband. He has a large income I have virtually none. (A small workers comp settlement payment which is non-taxable) He is self employed & claims about 1/10 of the income he actually makes. I don't want to sign anymore lies for him. I am also wondering if I can do an amended return & file married filing seperately. If the IRS ever audits him & his accounts I don't want to be responsible. Thanks

What about the fact that we had seperate bank accounts? I was never involved with the business at all. In fact I was told by him that his business matters did not involve me at all. I just signed the returns when he gave them to me. If there was a refund, I signed it & it went into his bank account. Am I still liable for his dishonesty?

Thanks for all the answers. Right now there are no problems with the IRS. I guess I will have to see if anything develops in the future.

Answer 1

Usually when filing married-separate each spouse will lose the benefit of certain deductions or they will be subject to limits on their use. There are other disadvantages that I won't get into. Also each spouse would be subject to a higher tax rate, higher than even single status.

It sounds by your situation with no taxable income filing married and separate may be a moot issue. Still, it is recommended to calculate your taxes using married-joint vs married-separate and see if you can live with the result.

As far as your husband's activities, there IRS rules for protecting a person such as yourself. These are called "innocent spouse" statutes and are designed to provide relief to unsuspecting or unsophisticated taxpayers.

If you feel there may be a strong possibility of being dragged into his mess I recommend contacting a tax professional.

Best of luck to you. AK

Answer 2

Sorry, but if you signed previous tax returns with him you are equally responsible as well. I do not understand what you mean by an amended return. You can amend taxes filed but what are you amending. If the IRS audits your husband and they find fraudulent returns they can reach back years of previous tax filings. Did you sign any of them? You may have to see a Tax Attorney.

Answer 3

The disadvantage to filing separately is that between the two of you, you'd owe more total tax. In your situation, he'd be the one to owe more though, not you.

If you have filed a joint return, you can't change it and amend it to married filing separately, so for any joint returns you've already filed, you would be on the hook for the extra taxes along with him, if and when the IRS catches up to him. The "innocent spouse" provision that someone mentioned only applies if you didn't know of his omittting income from the return, and had no reasonable way of knowing, so you wouldn't be eligible to claim that.

Answer 4

You cannot amend a past return from married filing jointly to married filing separately. If you get a court to annul the marriage, then you must amend your past returns from married to either single or head of household. (This applies only to an annulment from the court, not to an annulment from the Catholic Church or to a divorce.)

It is illegal to sign a return that you know is false. If you cannot get him to sign a return without lies, then you must file separately.

The primary disadvantage to filing separately is that his tax may be more than your combined tax would have been if you filed jointly. However, that is not your problem. It is better that he pay more in taxes (especially if it is still less than he should be paying) than that you go to federal prison.

Answer 5

stephenw has offered sound advice. In addition:

You need to file separately to distance yourself from his business, especially now that you are separated and would have NO idea about the accuracy of what he would report.

May I suggest that you ensure that he doesn't file jointly without your permission. File separately and file early (Jan. 1 if you can). Take the standard deduction, even though you won't have any tax liability. Then if he tries to file jointly without you, his return should get bumped.

Answer 6

If you can be civil long enough to file a joint return--one you are satisfied is OK--it will be best on both sides. Play let's make a deal--give me some of the savings and I will give you some ink. I had some family members in a similar situation and the difference was a net refund of about $6,000 against a net refund of $1,500. Both sides saw the benefits of cooperating one last time.