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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 13454
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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Ex-husband owned a restaurant with 2 other partners and then

Resolved Question:

Ex-husband owned a restaurant with 2 other partners and then bought them out and became the sole owner, holding all shares. I was not a share holder in the corporation but was married to him, the dept of revenue is trying to garnish my wages for a sales tax debt, can they legally take my wages if I had to interest in the business?
Submitted: 1 year ago.
Category: Tax
Expert:  Megan C replied 1 year ago.

MyVirtualCPA :

Thanks for asking your question! I'm sorry to hear about your tax issue and I'm going to try my best to help you understand or resolve it.

MyVirtualCPA :

Is the sales tax debt for a year that you were married to your husband, or was it for a period after you were divorced?

Customer:

It was for years that we were married

MyVirtualCPA :

If you were never an owner of the business, then you would not be responsible for the sales tax debt.

MyVirtualCPA :

I would get with a tax professional in your area to help you sort out this issue. You don't need an attorney - a CPA or EA will suffice

Customer:

I do not have access to any paperwork or anything pertaining to the business, the business folded, we filed bankruptcy and divorced. Would I just tell the cpa what I have told you and that will be enough?

MyVirtualCPA :

They might need more information on the business, such as proof that you were not a partner

Customer:

I can tell them I was not an owner, however I'm not sure where the stock certificates are that name my ex has the owner of the shares. The corporation was registered with the secretary of state. do you know how long they keep the information

MyVirtualCPA :

If it is a corporation then the state should have on record who was the owner. You mentioned partnership ... so that would be harder to prove. But, the state should have ownership information relating to the business

MyVirtualCPA :

They shouldn't be able to garnish your wages, although if you were still married they could take joint assets

Customer:

There were 3 partners in the beginning, I was never one of them,

MyVirtualCPA :

There is a provision under which the spouse may be liable. See http://www.scstatehouse.gov/code/t12c054.php "SECTION 12-54-127. Transfer of personal or real property; liability for tax; lien; inapplicability of provisions to certain transfers. When title to property, both real and personal, is transferred and the payment or collection of any tax is defeated because of the transfer, then the transferor, the spouse of the transferor, a fiduciary holding title to the property and a person for whose benefit the property is held, the officers and stockholders of a corporation transferring the property, and the transferee of the property, are personally liable for tax in an amount equal to the interest in the property transferred, and the liens provided by law for the tax attach to the property as if no transfer was made. The above provisions do not apply to a transfer to a bona fide purchaser or mortgagee for an adequate and full consideration in money or moneys' worth. The provisions of this section are in addition to and do not supersede any other provision of law."

Customer:

I was his spouse then, but not now. I feel like even as a spouse I was not an owner (share holder) and isn't that the reason for being a corporation to protect your personal interests like homes, wages etc...?

MyVirtualCPA :

Yes, and the provision that could make you liable is very specific - like if he transferred assets to you. In your situation, I really don't think you are liable for this. You can tell your local CPA or EA this and they can get the situation squared away

Customer:

Ok thank you very much, you've been most helpful :)

MyVirtualCPA :

I'm glad I could help. If you are satisfied, please rate my response as "excellent" so that I may receive credit for assisting you today

Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 13454
Experience: Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
Megan C and 5 other Tax Specialists are ready to help you
Expert:  Megan C replied 1 year ago.
Thanks, Tricia for your positive rating. Please come back and visit MyVirtualCPA for any of your tax, finance, and social security needs. It was a pleasure working with you today.

In the future, ask for me directly by placing "to MyVirtualCPA" in the subject of your question. Thanks again!

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