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LADYLAWYER
LADYLAWYER, Lawyer
Category: Legal
Satisfied Customers: 6531
Experience:  Civil; Family; HOA; Landlord/Tenant; Real Estate; Probate; Insurance; Immigration; Wills & Trusts
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I was married 2008 and 2009 .. my ex made significant income

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I was married 2008 and 2009 .. my ex made significant income as sole proprietor of a business he owned before we met. His business subsequently failed before he had paid the IRS and State of California taxes owed .. (business was a shambles and taxes filed late in 2010 money made in 2008 paid off debts from 2007 and money made in 2009 kept company afloat in 2010 before it failed completely)

We filed married but separately, I made very little income and filed and paid timely. Married in Hawaii but living in California. Separated in 2010 divorced 2012

I owned a house before we married and never put his name on it, the house has equity in it ..

1. Can the IRS or State of California come after me for the unpaid taxes? estimated in $100Ks with penalties etc

2. Can the IRS or State of California put a lien on my property?

3. What can I do to protect my house from the IRS, State and credit card companies that he used my social on and now refuses to repay?
Submitted: 1 year ago.
Category: Legal
Expert:  LADYLAWYER replied 1 year ago.

LADYLAWYER : Hello, Thanks for choosing Justanswer.com! I look forward to helping you with legal information today.
LADYLAWYER : Did you file married filing separately since the beginning of your marriage?
Customer:

yes

LADYLAWYER : Thanks.
LADYLAWYER : if that is the case, you are not liable for any of his taxes or penalties.
LADYLAWYER : With regard to the house...
LADYLAWYER : that is your separate property and would not be considered marital property since you did not put his name on it, thus that could not be liened or attached for any of his debt.
LADYLAWYER : If your name was on any of the debt as far as non-IRS debt (like credit cards), then creditors may be able to attach that debt to the house.
LADYLAWYER : The best way to protect it is to put it in some sort of trust where the creditors cannot get to it.
LADYLAWYER : For that, you would need the help of an estate attorney or one that specializes in asset protection.
LADYLAWYER : So, botXXXXX XXXXXne is that you do not have to worry about the IRS or the State as long as you always filed married filing separately. This removes your liability as each of you is responsible for your own tax debts this way. However, any debt he raked up while you were married is considered joint marital debt, unless you can convince a court that he used your social fraudulently and without your permission.
LADYLAWYER : If a creditor sues you to seek repayment of his debt, you can try going the fraud route in court.
LADYLAWYER : it is hard to prove because you were spouses and if you in any way benefited from the credit issued to him, the court probably will make you responsible
LADYLAWYER : But it's a defense to try, anyway.
Customer:

Yes I am unfortunately aware of the credit card situation .. I was under the impression that as a community property state the tax rules had changed around 2008/9 so that each spouse filing separately had to include half of their income and half of their partners?

LADYLAWYER : If the court does hold you liable, the creditors can lien your home, but only if your home is not in a trust.
Customer:

I'm thinking of putting my house into a corporation .. would that afford it the same protection?

LADYLAWYER : Yes, if you want to put your house into a corp as one of its assets, that would work, but you may be challenged and have to prove it is used as a corporate asset. Also, if you file a federal tax return separately from your spouse, you must report half of all community income and all of your separate income. That doesn't mean you are responsible as far as tax consequences for your spouse though.
Customer:

What is community income then? I assumed it was the combined income of the marriage so to speak? Until we divorced I thought the worst my ex was, was a repeated cheat, and a heartbreaker .. if only! I now realize that unfortunately marriage just makes you financially and legally responsible for reckless spouses! Sorry .. had to vent .. until now I've had perfect credit :/

LADYLAWYER : Ugh, so sorry to hear that. Similar ex story here. In the community property states, each spouse legally owns an undivided one-half interest in the total income and property of the marital community, plus their own separate income and separate property. Federal tax laws generally respects state laws in determining whether an item of income is community income and whether property is community or separate property. Because you technically own one-half of the martial income, you did have to claim it. But when it comes to tax consequences and penalties, the innocent spouse regulations still apply. Basically, you would say that as a married but separate filing spouse, you were following the guidelines regarding having to claim one-half of the marital income, but you are not responsible for anything as it relates to how he handled the filing of his taxes.
LADYLAWYER : Hi, still with me?
Customer:

sorry .. little ones needed attention

Customer:

sorry to hear you had a similar marriage

LADYLAWYER : Oh no problem! I understand. :)
LADYLAWYER : thank you
Customer:

he hadn't been filing for years and I forced him to because its the right thing to do! He didn't file until 2010 so I'm going to use that to explain why I could not have included it in my 2008 2009 returns and although not divorced I started filing head of household in 2010 or 11 as his behaviour had already amounted to him abandoning the marriage and me being solely responsible financially for caring for our family .. using savings and credit .. now I need to find/start a career so I can finally sleep easier .. he pays none of the debt and no child or spousal support .. thats just his MO I discovered after we married .. urgh

Customer:

do you have any advice for dealing with the credit card companies?

LADYLAWYER : Are they hounding you right now?
LADYLAWYER : If the credit card company has sold the debt, you have more rights than if the original creditor still has ownership of it.
LADYLAWYER : Sorry, I have other customers that are waiting on me and I need to step out. Is there a better time to continue with you?
Customer:

the credit debt is not that old .. largest card has $30K owed and I had to stop paying a year ago .. min went up to about $750 a month and they said I didn't have enough income to qualify for a payment plan ..

LADYLAWYER : There's not much you can do if the original creditor has the account. If they sell it to a junk debt buyer, then you're protected under the FDCPA and have a lot more rights.
LADYLAWYER : Not much you can do in the meantime though.
LADYLAWYER : Even in divorces where the judge assigns all of the joint debt to one party, if that party doesn't pay it, the credit card companies can legally come after the other party. They are not bound by the way the divorce court has divided up the debt.
LADYLAWYER : I strive for excellent service and I hope I provided that for you today; however, if you have any further questions, concerns, or need further clarification, please just reply to me here and I will get back to you just as soon as possible! There may be periods where I am helping other customers or may not be online but I will always get back to you within 24 hours. If you have no further questions at this time, would you kindly leave me a positive service rating before you go? Thank you so much!
LADYLAWYER, Lawyer
Category: Legal
Satisfied Customers: 6531
Experience: Civil; Family; HOA; Landlord/Tenant; Real Estate; Probate; Insurance; Immigration; Wills & Trusts
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