What Happens if a Spouse Who Owes Back Taxes Dies?

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Tax debt is an inherently stressful matter for any couple, but it becomes far worse when your spouse passes away.

Depending on your situation, you could be liable for your spouse’s debt. Keep reading to determine where you stand and which steps you can take to resolve the issue.

Who Is Liable For Your Spouse’s Tax Debt?

For spousal tax liability, a lot depends on how you file. With independent filing, for example, only the individual is liable. Many couples file jointly, however, as this approach tends to confer significant tax advantages. In this situation, the other spouse can be found fully liable for unpaid taxes, regardless of who is technically to blame for getting into debt in the first place.

How Does the IRS Handle Back Taxes After a Spouse’s Death?

Even if you and your spouse filed taxes on a separate basis, you may find the IRS interfering by attempting to satisfy debts with your partner’s estate. Unfortunately, this may mean that the amount ultimately received from the estate is significantly reduced due to ongoing tax issues.

In some cases, it’s possible to avoid back tax recovery by requesting innocent spouse relief with the IRS. This option is reserved for situations in which the surviving spouse was unaware of improper reporting or tax return omissions. Approval could mean avoiding both taxes and associated interest or penalties.

Unfortunately, innocent spouse relief can be difficult to secure, as the IRS maintains strict eligibility standards. A tax professional can help you qualify, or, if necessary, find alternate solutions for helping you handle your tax debt concerns as you continue to mourn the loss of your spouse.

If you’re struggling to deal with back taxes in the aftermath of a loved one’s death, look to the Highland Tax Group for help. We can handle IRS matters to ease your burden during this difficult time. Contact us to learn more.