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Wife passed away and wasnt filing taxes. Am I liable for her debt.?

Jamestown, NY |

She didnt file 07-2011. A week after her death I started receiving notices and promptly had the taxes taken care of. I had no idea until then how much she owed or why. So far it is close to $60 Grand and that's just state. What should I do and who do I call.? I retired earlier this year and wont be 62 for two more years so money is tight. She did not have an estate and any life insurance she did have went to funeral expenses and all the credit card debt that she had, which she applied for without my knowledge at all. Please help.

Attorney Answers 3

  1. It is important to know the filing status. I take it from your question that you filed your taxes between 2007 and 2011, but it is not clear. If you were filing jointly or have joint assets, you may be on the hook or the IRS/State Tax Authorities may have a lien against your assets. The facts are really critical here. If you paid the state taxes, that may actually be a positive. Given your financial circumstances (just retired and not collecting SS), you may be able to discharge any part of the taxes you may owe through an Offer-in-Compromise for a very small sum. IRS generally tends to be about 3 times the state debt, so if it is $180K and you are responsible for it, it would be well worth it to file an Offer in Compromise.

    You should read up on the IRS Fresh Start Program and Offers in Compromise. Please give me a call if you would like to discuss the facts of your case in more detail.

    If this answer was helpful or was the best answer please flag it as such so I may receive credit.

  2. You need to sit down with a tax attorney asap. As noted, you may be able to invoke innocent spouse status (IRS guidelines for this were just revised). You may also be able to address the taxes in such a way that the tax impact is minimized but $60K for state taxes is huge and you need to take measures to protect yourself at this point.

    Good luck.

    Evan A. Nielsen

    1255 W. Colton Ave., #506 | Redlands, CA 92374
    Main: 909.363.4658 | Fax: 480.304.3211

    Mention this post for a free consultation

    Evan A. Nielsen is licensed to practice law in California. The information provided here is for educational purposes only and is not intended as legal advice for a particular matter. This response does not create any attorney-client relationship with the author. For specific advice about your particular situation, please consult an attorney.

  3. As Evan addresses this is something you should not be handling alone, you should have an experienced tax controversy attorney or enrolled agent on your side to help you navigate. Depending on the unique facts and circumstances there are likely ways to minimize the amount and having an experienced tax professional on your side will cost you, but it will cost you less in the long-run than trusting your tax affairs to what you can google or find on wikipedia.

    Best of luck

    There is NO attorney-client privilege based on this interaction. I am NOT your attorney. Further, everything we both just wrote is publicly available on the internet and would be the same as if we were talking in a crowded restaurant. If you need legal assistance use Avvo to find a local attorney in your jurisdiction that you feel can best represent your interests as a zealous advocate. My experience is in corporate tax, white collar criminal defense, partnership tax, and tax controversy/litigation. If you're being audited by the IRS or state taxing authority, or you are taking an unusually risky tax position on a return, that is the kind of thing you should have experienced counsel on your side and we can set up an initial consultation. If you have a family law, debt collection, violent crime sort of issue then I do not handle that. Do not contact me for an initial consultation on non-tax matters.

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