My husband was working for himself for 4 months. Each week I took the necessary taxes out and put them in a "business" account. About a month ago he used the money to bail a friend out of jail. Now tax season is fast aproaching and he has nothing to put in for those 4 months. He had a "regular" job before this 4 months and he has one now but for those 3/4 months we owe about $1400.00. Am I going to be held responsible for that as well becasue were married?
2007-12-11 05:20:41 · 12 answers · asked by cheysmommy11 1 in Business & Finance ➔ Taxes ➔ United States
Last I looked, if you in anyway profited from it you owe it.
Take out a loan and make the next business account a joint signature one.
That's where both signatures are needed.
I suppose the bailed out friend is not going to repay the money and there was no security either.
2007-12-11 05:29:33 · answer #1 · answered by justa 7 · 0⤊ 0⤋
I would echo VB's answer that you do not meet the definition of either an innocent or injured spouse.
As pointed out above, filing MFS in a non-community property state can prevent you from being liable for your husband's underpayment. However, your combined tax liability would probably be far higher by filing MFS. Unless your marriage is in trouble and will soon dissolve, that will hurt rather than help.
Your best option is a payment plan, but keep in mind that you still have 5 months before you have to file. You still have time to come up with some of the funds.
2007-12-11 06:02:13 · answer #2 · answered by taxreff 7 · 0⤊ 0⤋
The short answer is yes.
Other answers have advised filing seperately -- PLEASE see a very expereinced tax professional before trying this. There are a lot of confusing limitations when you do this, and it may actually increase the tax liability in the larger picture.
Also expect there to be a penalty for failure to make quarterly estiamted tax -- both federal and state. Please go to www.irs.gov and look up publications 334 - tax guide for small business, 505- tax withholding and estimated tax, and 583- starting a business and keeping records. You will need this information to complete this year's tax forms even if your husband is finished with self employment.
Remember you can set up a payment plan with the IRS (with a few limitations.) The earlier you know your final figures and contact them, the better off you will be. Good luck.
(I don't know anything about innocent spouse relief. The IRS has publication 971 to help you decide if that is appropriate.)
2007-12-11 05:48:41 · answer #3 · answered by Melissa M 1 · 0⤊ 0⤋
Ignore all posts about "injured spouse" and "innocent spouse" relief. These do not apply to your situation. People love to toss these phrases around without actually knowing what they are for.
If you are NOT in a community property state, you could file MFS returns. That will probably increase the tax bill, but would limit the liability to your husband's SSN. (Then if you ever get divorced, his debt won't follow you around.)
If you are in a community property state, this won't work because generally half of the income is yours under state law and so it half of the income tax bill.
If you cannot raise the money by tax time, you can, if necessary set up a payment plan. This is not fun, especially if your husband continues to be self-employed (as Dave Ramsey would put it, rice and beans, beans and rice.)
2007-12-11 05:47:28 · answer #4 · answered by Anonymous · 0⤊ 0⤋
You probably should have been paying estimated taxes, unless his witholding from other "regular" jobs was enough to cover your tax liability. You will not go to jail for that, but you might owe some interest and penalties.
You will need to report the self employment on Schedules C and SE.
2007-12-11 06:08:30 · answer #5 · answered by r_kav 4 · 0⤊ 0⤋
$1400.00 isn''t that much - especially with him being self-employed - he should have a good number of deductions. If that doesn't work and you file jointly, there is an "injured spouse" filing that can be done, but there is certain criteria that must be met.
2007-12-11 05:36:42 · answer #6 · answered by kwflamingo 6 · 0⤊ 1⤋
If you're self employed then you ARE the boss and you do your tax yourself using your UTR
2016-05-23 01:57:36 · answer #7 · answered by cornelia 3 · 0⤊ 0⤋
Not because you were married unless you live in a community property state, but if you file a joint return, you will be equally responsible with him for what he owes.
2007-12-11 05:35:59 · answer #8 · answered by Judy 7 · 1⤊ 0⤋
I have two suggestions:
1) file separate returns
2) look at "innocent spouse relief" from the IRS website...www.irs.gov
Then search for: innocent spouse relief
You have a legitimate concern. Do the right thing.
2007-12-11 05:24:09 · answer #9 · answered by jwishz 7 · 0⤊ 2⤋
well, better save like crazy to save the 1400. When tax time comes around, see if you can negotiate to pay it in installments.
2007-12-11 05:25:37 · answer #10 · answered by Anonymous · 1⤊ 0⤋