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I owe back income taxes. Will the IRS take my spouse's income and assets into the equation even if I created this mess?

Travis Watkins
by Travis Watkins
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Senior Attorney at Travis W. Watkins, P.C. and Creator of taxhelpOK.com

 

A: Yes, with income taxes, they will if you filed jointly. In this situation, not only will the IRS take the spouse's income and assets into account, the spouse would also be held liable. Keep in mind: there are always ways to put you both in the best position possible with the IRS. One way for example, is to argue value of the assets. The IRS is always going to try to assess the value of an asset higher than its value. On the other hand, if you filed separately, but live together, the IRS may take the non-liable spouse's income and assets into the equation, but that does not mean they are attaching the liability to him/her. Many people get confused between the two and think that just because their spouse's financials are being revealed that the liability is being assessed to him/her. That is simply not the case. Furthermore, in this situation, we would input a mathematical formula to take the non-liable spouse out of the equation. This creates a realistic scenario often in our client's best advantage. We would also argue value of the assets. Lastly, if the liability is from a sole proprietorship, we could save some of the assets if they are necessary for the production of income.