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Tax Refund seized for wife's back tax due from 2008

Forum|Forum|2 years ago
May 4, 2023
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Can the IRS take my refund if there is unpaid tax over 10 years old?

My wife incurred a fair amount of debt hiring sketchy people to do her taxes well before I met her. They didn't pay the tax she owed and made off with the money and she was left with a couple of years of huge unpaid tax debt.

We got married and I was not in any position to pay it off. Since we got married, I paid our taxes to be sure it was all done right. We were married in 2007. Over the years we've been married, most of them taxes were filed jointly, I have never gotten a return when I was due one because of my wife's debt. I know that I can file for "injured spouse" but didn't want to. I didn't want to create more problems or inadvertently turn up the heat on her.

This year, I was expecting to get a refund, a) because it has been over 10 years since she incurred her debt and the IRS has a rule that allows them only 10 years to pursue debt and b) a couple of years ago we were due $4 and got a refund check for that amount. She received a letter today addressed to only her despite our joint filing, that our return would not be coming but would be going towards her debt from 2008.

I am reading this: Internal Revenue Code section 6502 provides that the length of the period for collection after assessment of a tax liability is 10 years.

My question is, can they continually collect on this debt that is way past 10 years?

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Best answer by rjs

Even though you file jointly now, only your wife is responsible for the tax debt that she incurred before you were married. That's why the letter is addressed only to her.

Certain events can extend the 10-year collection deadline. See the following on the Taxpayer Advocate Service web site.

Collection Statute Expiration Date (CSED)

TAS Tax Tip: Understanding your Collection Statute Expiration Date (CSED) and the time the IRS can collect taxes

If none of the listed events apply to your wife, she should first call the IRS and ask what their records show as her CSED. If your tax return was filed after the CSED, see if the letter has instructions for what to do if she disagrees with it. If the CSED has been extended, she will have to look into why it was extended. She might need help from a tax professional who has experience with IRS collections.

Since only your wife is responsible for the debt, you can recover your share of the refund from your joint return by filing an injured spouse claim, Form 8379. But if the CSED has passed and the IRS should not have collected the debt, you and your wife should direct your efforts to recovering the full refund, instead of just your part of it.

Form 8379

Instructions for Form 8379

You have a difficult situation, and IRS rules and procedures can be confusing and hard to understand. If you cannot resolve the problem easily, you should get professional help.

B

Bsch4477

Employee

You are correct about the 10 year rule. Discuss with the IRS

rjsAnswer

Employee

Even though you file jointly now, only your wife is responsible for the tax debt that she incurred before you were married. That's why the letter is addressed only to her.

Certain events can extend the 10-year collection deadline. See the following on the Taxpayer Advocate Service web site.

Collection Statute Expiration Date (CSED)

TAS Tax Tip: Understanding your Collection Statute Expiration Date (CSED) and the time the IRS can collect taxes

If none of the listed events apply to your wife, she should first call the IRS and ask what their records show as her CSED. If your tax return was filed after the CSED, see if the letter has instructions for what to do if she disagrees with it. If the CSED has been extended, she will have to look into why it was extended. She might need help from a tax professional who has experience with IRS collections.

Since only your wife is responsible for the debt, you can recover your share of the refund from your joint return by filing an injured spouse claim, Form 8379. But if the CSED has passed and the IRS should not have collected the debt, you and your wife should direct your efforts to recovering the full refund, instead of just your part of it.

Form 8379

Instructions for Form 8379

You have a difficult situation, and IRS rules and procedures can be confusing and hard to understand. If you cannot resolve the problem easily, you should get professional help.

Critter-3

That 10 collection rule is not hard and fast and certain things can and will extend the collection period ... main thing I see is that you have been making annual payments to the debt thru the refunds on the joint return. That 10 year period is really for folks who fall off the planet and never make any payments.

What happens when the collection period ends?

When a specific collection period ends, the IRS may no longer initiate administrative or judicial collection of the remaining assessed tax debt. If the IRS levies on a taxpayer’s fixed and determinable right to future income prior to the expiration of the associated collection statute, the IRS may legally continue to attach to and receive payments from that levy beyond the expiration of the CSED.