Can a divorce decree dictate your filing status???

[jaam]

I am at my wits end, this has been a nightmare. I would love some input if anyone has anything like this in their decree or has heard of anything like it at all....

Our divorce decree stated that we were to file our taxes as married/joint for the last year of marriage (2010). The decree was filed and the divorce finalized on Dec 29, 2010. In April when we went to file married we found out that your marital status as of Dec 31 determines your filing status for that entire year. So we filed an extension. October rolls around and I go ahead and file head of household like I'm supposed to. Xh finally files single and discovers that he owes a huge amount of taxes (since for all of 2010 he was planning on being able to have the married deduction..). 

He's throwing a huge fit now and threatening to take me to court saying that I am in contempt for going against what the decree stated. Every source I have talked to says that I'm fine, that I did the right thing, that filing married would have been illegal. Strangely, every source that xh talks to tells him that the decree overrides the IRS rule and we can amend so he doesn't owe so much.

If I go to court and lose, I pay court/lawyer costs for all parties. I cannot afford this. I already used the majority of my refund to pay bills that were in collections, I have no idea how I'd pay that back if we do end up amending our taxes. But I'd rather do that if I need to to stay out of court, as long as the info xh is coming up with is accurate. 

Any help???? 

[Super~Single~Mama]

Is there a way for you to call the IRS?  I would  call the IRS if you can find a number, and ask THEM.  Or, talk to a big tax firm, or a tax attorney, and have them send your ex a letter.  I think you are right, and he's probably bluffing you so that you'll give in (and lying about what he's been told), and likely won't take you to court.

Good luck!

[Murph12334]

oh boy!  What a mess.  Yes I agree with previous poster and try to just get ahold of irs and find out directly from them what you are supposed to do.  That way you know if they will honor it or not.  You might get flagged and audited after all this anyways.  Make sure if you do get an answer from the irs you take down the name and the exact info the person tells you.  Just in case it's ever asked, you have it to back yourself up.

[jaam]

Thanks! I feel so relieved to hear that! It's been a roller coaster though, because I have contacted the IRS and so has my ex, and we both got different answers. I feel like we're asking different questions! I am having trouble getting tax attorneys to hear me out since they look at it as "family law", but I have a couple more on my list to call today.

I'm still curious though if anyone else has had something like this put in a divorce decree, is it normal? Or are tax issues (beyond who claims children) not normally put in decrees??? 

[Super~Single~Mama]

Originally Posted by jaam 

Thanks! I feel so relieved to hear that! It's been a roller coaster though, because I have contacted the IRS and so has my ex, and we both got different answers. I feel like we're asking different questions! I am having trouble getting tax attorneys to hear me out since they look at it as "family law", but I have a couple more on my list to call today.

I'm still curious though if anyone else has had something like this put in a divorce decree, is it normal? Or are tax issues (beyond who claims children) not normally put in decrees??? 

When you talk to a lawyer, you have to frame your questions in ways that make sense to them - because they don't think like normal human beings (I'm a lawyer, I would know).  Tell them this:

"My ex-husband wants to file as married for the year of 2010 (or whatever year it was).  My understanding is that we could only file as married if we were still married as of December 31, 2010.  Our divorce became final on December 29, 2010.  My understanding is that the date of our divorce being final precludes us from filing as "married" since it was before Dec. 31, 2010 - is that true?

Your divorce decree cannot re-make the laws.  Your state cannot tell you that you don't have to follow federal regulations (IRS regulations are federal), even in a court order.

ETA - you should also consider asking the attorney that helped you with the divorce.  They should be able to find out the answer for you.

[tccandlsccmom]

You are right.  He is wrong.  I am not a tax lawyer, but I am a lawyer, so I did a quick bit of research....

It is clear in the official government publication 

Publication 504 (2010), Divorced or Separated Individuals , available on the IRS website, see http://www.irs.gov/publications/p504/ar02.html#en_US_2010_publink1000175818

"Relevant language: 

Unmarried persons.You are unmarried for the whole year if either of the following applies.

• You have obtained a final decree of divorce or separate maintenance by the last day of your tax year. You must follow your state law to determine if you are divorced or legally separated.

  Exception. If you and your spouse obtain a divorce in one year for the sole purpose of filing tax returns as unmarried individuals, and at the time of divorce you intend to remarry each other and do so in the next tax year, you and your spouse must file as married individuals."

If he takes you to court after you present him with this, move for costs....

And a state divorce decree CANNOT override federal law.  Period.

Edited by tccandlsccmom - 11/4/11 at 1:36am

[jaam]

This man has a way of making his own laws and making other people believe they're legit. Example: he called the same IRS phone number that I have been calling, argued with the agent until she agreed with him and said something to the effect of: "there are federal IRS regulations in place in case there is nothing dictated by the state. Since in this rare case there IS something dictated by the state, the IRS will honor it." He has her name, number, etc and will use this in court. I don't see how I can afford to go to court if I'm not 110% sure I will win outright. I'm not that sure I will win, even though I do still believe I'm right.

The state I'm in has never seen clauses like this in divorce decrees and everyone pretty much says it's cut and dry "no". The state he's in, apparently people do this and he has talked to lawyers/tax professionals that say it's possible. IRS pub 504, page 4 says:

"State governs whether you are married or legally separated under a divorce or separate maintenance decree."  

Ex is interpreting this as "the state has the authority to govern your marital status in terms of how you file taxes" and since the decree clearly says that we're to file married for 2010, therefore we are obligated to do so.  ETA: The lady he argued with ended up agreeing with him on this, which I think is nuts.

I went ahead and told my ex that I'd sign and let him have his tax guy amend our stuff and file married. I did that thinking that if the IRS rejects it, then we're back to where we started and I get my refund back. But with how conniving he is, I'm pretty sure he'd appeal and get his way anyway. I'm at a loss. I'd really love to fight this, and would if I could afford a good attorney. I have dealt with the legal aid service in this town with little luck so I don't see any other options really. I hate hate hate (and I don't normally use that word!) constantly feeling like he has so much control over my life still!!! 

[jaam]

tccandlsccmom -  the IRS publ you found, do you think that would hold up in court even though we didn't marry for the purposes of taxes? I see how it could maybe go that way, but then I feel like it's saying that my ex is right in interpretting the "state governs marital status" sentence as differently.  

Is there a way to find out if there's something in the IRS literature (without reading all of it!) that says what ex's IRS agent told him is true... that the regulations are in place in case there's nothing dictated by the state in terms of filing status?

[Super~Single~Mama]

Originally Posted by tccandlsccmom 

You are right.  He is wrong.  I am not a tax lawyer, but I am a lawyer, so I did a quick bit of research....

It is clear in the official government publication 

Publication 504 (2010), Divorced or Separated Individuals , available on the IRS website, see http://www.irs.gov/publications/p504/ar02.html#en_US_2010_publink1000175818

"Relevant language: 

Unmarried persons.You are unmarried for the whole year if either of the following applies.

• You have obtained a final decree of divorce or separate maintenance by the last day of your tax year. You must follow your state law to determine if you are divorced or legally separated.

  Exception. If you and your spouse obtain a divorce in one year for the sole purpose of filing tax returns as unmarried individuals, and at the time of divorce you intend to remarry each other and do so in the next tax year, you and your spouse must file as married individuals."

If he takes you to court after you present him with this, move for costs....

And a state divorce decree CANNOT override federal law.  Period.

Originally Posted by jaam 

tccandlsccmom -  the IRS publ you found, do you think that would hold up in court even though we didn't marry for the purposes of taxes? I see how it could maybe go that way, but then I feel like it's saying that my ex is right in interpretting the "state governs marital status" sentence as differently.  

Is there a way to find out if there's something in the IRS literature (without reading all of it!) that says what ex's IRS agent told him is true... that the regulations are in place in case there's nothing dictated by the state in terms of filing status?

See the bolded in the above post.  Yes, your state DOES determine your marital status - but your divorce was FINAL prior to the last day of your tax year!  Your state gave you a final divorce decree - meaning that you were divorced as of Dec. 29, 2010.  Which is BEFORE December 31, 2010.

[Goodmom2008]

Your ex is in for a rude awakening (so is the judge who thinks that state law trumps federal law) should he take this to court. 

You did nothing wrong.  You filed the only way the IRS would let you per federal law.  I really do wish these state court judges would take the time and learn about filing laws as it pertains to divorce and how one can't file married/joint.  Your case is an example of the lack of knowledge on the state court's part.  Just take your paperwork from the IRS that states since you were divorced by 12/31/10, you aren't eligible to file married/joint.  You have no control over the IRS regulations.

But the issue of the taxes will be addressed and you may end up having to pay a part of his taxes owed. 

[Goodmom2008]

Originally Posted by jaam 

Thanks! I feel so relieved to hear that! It's been a roller coaster though, because I have contacted the IRS and so has my ex, and we both got different answers. I feel like we're asking different questions! I am having trouble getting tax attorneys to hear me out since they look at it as "family law", but I have a couple more on my list to call today.

I'm still curious though if anyone else has had something like this put in a divorce decree, is it normal? Or are tax issues (beyond who claims children) not normally put in decrees??? 

Your ex, in all likelihood, did not tell the IRS that the divorce was final in 2010.  Had he done that, he would have gotten the same answer you got.  BTW, I am not a lawyer, but I am an accountant.   

[jaam]

I'm starting to think my ex hasn't even filed yet at all, but that would be even crazier. New findings have made this a little more complicated... someone read my decree and thought that perhaps our divorce WASN'T in effect on Dec 29th because of a clause that says: 

"each party shall provide all documents necessary to effectuate the terms of this Agreement within 15 days of the effective date of this Agreement...."  

To me that still says the divorce was effective on the 29th, not 15 days after, or once we had our paperwork turned in. Any thoughts on that?

Also, I got the Earned Income Credit, and if I end up repaying my refund to the IRS I'll pretty much ruin any chance of ever claiming that again. It was a huge help! Also, apparently (and I didn't know this or I might not have let the CPA get me the EIC) I had to have claimed both children for that. I did think I was leaving him both children to claim. That might get me in legitimate trouble. But if this goes to court I think I'd like to ask that we each claim one child from now on.

So my plan is to offer ex a good portion of my return to cover some of what he owes. Or most all of it if need be, to avoid having to pay anything back to the IRS and hope that ex will agree to us both claiming one kid on our filings from now on.  I cannot tell you all how much I appreciate the input!  This has been such a huge issue (on top of everything else in our crazy lives) and I am feeling guilty that it takes away some of my patience that I need for the kids on a normal day-to-day basis. 

[Goodmom2008]

There has to be a starting date or you would be married to the end of time.  The effective date is that date that the divorce was finalized, which is 12/29/10.  You were divorced  before 2010 ended.  Do not offer your ex a good portion of your return.  This is an error on the court's part.  You shouldn't blindly try and compensate for that.

What you should do is do the tax return as if you were able to file jointly.  And then compare what his tax owed is and offer to split, in proportion to your incomes, the difference.  Here are several examples:

Scenario 1:  Together, the tax owed would have been $1,000.  Separately, he owes $2,000.  He had $2,000 withheld.  You owe him nothing.  That $2,000 withheld was completely joint.  If there had been a refund, he would have owed you money for 2010 taxes.  He won't like this, but too bad. 

Scenario 2:  Together, the tax owed would have been $1,000.  Separately, he owes $2,000.  He had $1,000 withheld.  He still owes $1,000.  You also owe a portion of that.  And how it gets split is going to be determined by how the debt was split in the divorce (which was final on 12/29/10).  If it was 50/50, then you would owe $500.  If it was 60/40 in your favor, you would $200.  He won't like this, but too bad. 

There is also a chance that he may be able to get a portion of your tax refund.  Not the any of the EIC portion, but up to the amount that you got  back from what you had withheld from your paycheck. 

And if he tries to talk you into giving him more, stand up to him.  Tell him to take you to court, you filed the only way that the IRS would let you given that the divorce was clearly final on 12/29/10.  Even with that clause.  Which clearly states that each party was to provide the documents necessary within 15 days of 12/29/10.  Which, again, makes no sense given that employers have until 1/31 of any year to get the W-2 form to their employees.  Just another example of State judges needing to learn more about the tax laws. 

[jaam]

Well I was thinking of offering him that because, as well as saying that we were supposed to file joint, the decree says he was supposed to claim both kids until I make $X per year, and I thought I was letting him claim the kids. Even signed and faxed the form 8332's to him, then later found out that I had actually claimed them. Oops. That could get me in trouble I think. I just really don't want to have to pay the IRS back is all, so I still have the option of doing the EIC in the future. I think I'm at peace with the fact that this might end up in court. 

Goodmom2008, that's a really good idea, I may present him with that. Thanks. 

And yes, I have a very hard time standing up to him. Always have. It totally sucks, but that's a whole other issue! 

[tccandlsccmom]

Agree with what was said about the divorce being final as declared by the state on December 29 and the state court judge not doing their job. The IRS form should absolutely hold up in court.  As to claiming the kids, if you sent him the 8332s you may be a bit in trouble there, so your plan is probably best if you can swing it. Again, caveat that I am NOT a tax lawyer....and not representing you....just opining as a person who reads fairly straightforward rules.

Why would he be interested in court if he is low on funds?  Oh, wait....my ex is low on funds (claims to have none) and still is continuing the custody batter from h-e-double hockey sticks..

[Goodmom2008]

Originally Posted by jaam 

Well I was thinking of offering him that because, as well as saying that we were supposed to file joint, the decree says he was supposed to claim both kids until I make $X per year, and I thought I was letting him claim the kids. Even signed and faxed the form 8332's to him, then later found out that I had actually claimed them. Oops. That could get me in trouble I think. I just really don't want to have to pay the IRS back is all, so I still have the option of doing the EIC in the future. I think I'm at peace with the fact that this might end up in court. 

Goodmom2008, that's a really good idea, I may present him with that. Thanks. 

And yes, I have a very hard time standing up to him. Always have. It totally sucks, but that's a whole other issue! 

You need to file an amended tax return.  Since you are the primary parent, you would still get the EIC for the kids (along with any childcare deductions as that goes to the primary), just not the child tax credit or the exemptions.  You would still get the HOH status as you have the kids the majority of the year.  His only option is single.  You may or may not have to pay the IRS back some money.  But you did meet the requirements for EIC and claiming the kids for that. 

It's easy to make a mistake when you really don't know much about taxes and tax law.  Which is why the IRS does allow for amended returns. 

[jaam]

Ok so I actually just checked at what was filed and maybe I didn't claim the kids. Wow this is confusing! The kids are listed under the EIC qualifying child info, but not under exemptions/dependents. So I think maybe I am ok.... I hope so! I was confused because yesterday an accountant I talked to here in town told me that I probably claimed them if I got the EIC. So am I understanding it correctly now? I can get the EIC and HOH without actually claiming the kids as dependents?

That's why I was thinking maybe ex hadn't filed, because if he found out that he hadn't been able to claim the kids I'm sure he would have said something to me. 

I hope lots of people who are about to get divorced (or are in the midst of negotiating) are reading this so they can avoid messes like I'm in!

[Goodmom2008]

As long as you didn't take the tax exemptions, then you are fine and you don't have to refile.

In order to qualify for EIC for the kids, they have to live with you for over 50% of the year (going strictly by overnights), if you claim this when you aren't legally able to, then you will have to pay the money back and won't be able to claim EIC at all for 10 years.  It doesn't matter if you claim the exemption for the kids.  The residency requirements are required for HOH, but you don't have to wait 10 years to be able to claim HOH status should you file under this status erroneously. 

Your ex, on the other hand, cannot claim the kids for EIC or HOH status if they live with you most of the year. 

What needs to happen is that family court judges need to take a few courses on tax law.  Maybe then they won't make these rulings that cannot be followed through on due to federal law. 

Although, I do suggest that you don't mention that fact to the judge should your ex take you to court over this.  Let the judge figure it out on their own when you present them with the proof that you were unable to file jointly for 2010 due to the judge finalizing the divorce before the end of 2010.

BTW, that accountant needs to go back to school.  As mentioned before, I am an accountant.  I don't work with taxes, but the ability to claim EIC even when not taking the exemptions is something that I knew just from reading the instruction booklet and researching on the IRS website. Same goes for the childcare deduction. 

[jaam]

Awesome. I guess I should have looked at the actual paperwork first before assuming that I had claimed them just by what that guy told me! Thanks so much for your help!