Q: My husband has taken draws from a company that he is part owner in for two years and hasn’t claimed as income on taxes.
He has always handled taxes in past and I just found this out. Is this illegal? What could the ramifications be for me as a spouse? If I file separately, can I avoid being responsible for his decision? Legal seperation is in the works for marriage
A:
If you have or will file any joint tax returns with him you are both separately and jointly liable for any taxes due whether they are due when the return is filed or as the result of an audit. If you file separately you will not be liable for any of his tax debt for the years you have filed separately.
You may be eligible for innocent spouse relief if your return is audited. You have to apply within two years of the IRS notifying you of the liability. If you move, make sure you change your address with the IRS. The IRS will send a notice to both of you.
If you end up having to file for innocent spouse relief I strongly recommend that you speak with a tax attorney prior to filing. Just stay away from the places you see advertised on TV.
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