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I am in a registered domestic partnership in the state of Oregon,

and would like to get...
I am in a registered domestic partnership in the state of Oregon, and would like to get married in Washington but continue to live in Oregon. As I understand it, Oregon is not a community property state. My spouse defaulted on her federal student loans before we were together. She is now a stay-at-home mother and homemaker, and entirely my dependent. In the past, I have had to file my federal tax returns as a single person, and have claimed my partner as my dependent. If we are married, we will be able to finally file jointly, but I am concerned that my refund may be seized to satisfy her defaulted student loan debt. My questions are: Will the IRS seize my tax refund for my wife's debt even though we do not live in a community property state? Does it matter that the debt was incurred before the marriage? If they will seize my refund, can I file an injured spouse form even tough my wife has no income? If I do this, will I receive my entire refund, or will the IRS take part of it? Thank you.
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Answered in 3 minutes by:
9/13/2013
Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16,581
Experience: Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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Megan C :

Thank you for your question, and thanks for using JustAnswer.com

Megan C :

How are you today?

Megan C :

If you file as married, and your spouse has federal debt, there is the chance that the IRS will take your tax refund. However, if you file the injured spouse form the portion of the refund that is attributed to you will not be seized

Megan C :

So if your partner didn't work, then the refund is all yours and it won't be seized

Megan C :

This is true because you are not in a community property state. In a community property state they would take half.

Megan C :

If you don't file the injured spouse form, then the IRS could take your refund, it doesn't matter that the debt was incurred prior to your marriage

Megan C :

So it is critical to fill out that form.

Customer:

Hello,

Megan C :

Hello

Customer:

Does the IRS seize spousal income to satisfy the other spouse's debts when the couple live in a separate property state, then?

Megan C :

No, they do not seize your income to satisfy the other spouse's debt.

Customer:

And yet I still need to file that form? Why? Is it just in case?

Customer:

I apologize, I mean your tax return, not your income.

Megan C :

I knew what you meant. You need the form so that they do NOT seize your refund

Megan C :

if you do not have that form, they will even if the debt happened prior to marriage

Customer:

Even though we live in Oregon?

Megan C :

Yes, even though you live in Oregon

Megan C :

Because the IRS does not know what part of the refund is associated with each spouse unless you file that form

Customer:

I would think they would know that the refund was associated only with me, since I am the only income earner, but if they want the form, that is ok with me.

Megan C :

Yes, you need the injured spouse form.

Customer:

So because my spouse has no income, I should still receive all of my refund?

Megan C :

Yes, that is correct

Customer:

If she starts working again, they will take her portion, yes?

Megan C :

Yes, that is correct. They will take her portion of the refund.

Customer:

Ok. If that happens, we will have to decide if it would be better to file separately, I suppose.

Megan C :

No, you still have the injured spouse form. Just fill out her W-4 so she has the correct amount withheld to cover just her portion of the tax and then you won't have to worry about it because she won't have a refund

Customer:

Ahh, thank you. Good advice.

Megan C :

You're welcome

Megan C :

Is there anything else that I can assist you with today?

Customer:

No, I think that will do it. I appreciate your help.

Megan C :

Thanks. XXXXX could help. If you would, please rate my response as "excellent" so that I may receive credit for assisting you today

Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16,581
Experience: Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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Megan C
Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16,581
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