Nebraska Supreme Court Allows Divorcing Couples to File Separate Tax Returns

Posted on Jul 27, 2012

You might think that a couple on the verge of divorce would choose to file their last year of taxes separately, rather than jointly—after all, no matter how many years they’ve been married, they are now embarking on separate lives. Surprisingly, though, many state courts around the nation involved in contentious divorce battles have been ordering couples to file joint tax returns, presumably because this makes the tax paper trail easier to follow.

Now, according to Forbes.com, the Nebraska Supreme Court has ruled that this process is illegal, and divorcing couples cannot be compelled by the state to file joint returns. This decision involved a mix of practical and legal reasoning; practically, the court said, “for a divorcing spouse with little or no taxable income for the tax year, signing a joint tax return may pose considerable liability risk with no appreciable benefit.”

What the court is referring to, of course, is that filing a joint return exposes the divorcing spouses to “joint and separate liability”—each spouse, individually, can be pursued for the full tax payment. The Nebraska court did acknowledge that the IRS allows spouses to file for “Innocent Spouse” relief, but “the regulations are complicated and predicting liability would frequently require considerable tax expertise,” i.e., an experienced tax lawyer.

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