“Injured at the Joint”: Federal Income Tax Return Form 8379 – Injured Spouse Allocation

A few short years ago, you married the love of your life and more than likely, your bank accounts, loans and mortgage, autos, and tax returns are now in both spouses’ names, being “jointly” owned. In general, this means you both accept the rights, responsibilities, risks and rewards that come with marriage. Unfortunately, some couples have endured the stress caused by prior obligations of one or both spouses. Debts such as child support or alimony in arrears, student loans, or back IRS and State taxes owed are reasons the federal or state tax refund you thought was coming this year may be fully garnished to pay down these obligations. And be aware that your federal tax refund can and will be confiscated to pay any state obligations.

In order to stave off at least part of the garnishment, you may file IRS Form 8379 – Injured Spouse Allocation if all three of the following conditions apply:

 1) The injured spouse is not required to pay the past due amount,

 2) The injured spouse reported income, such as wages, taxable interest, etc., on the joint return, and

 3) The injured spouse made payments, such as federal income tax withheld or estimated payments, or claimed the Earned Income Credit or other refundable credit on the joint return.

There is an exception however, in that if the main home of the injured spouse was in a community property state, the spouse may file IRS Form 8379 if only the first condition applies. You can determine if you reside in a community property state by referring to the instructions to IRS Form 8379. 

(Source: http://thetaxlibrary.com/thetaxbook-federal-2011/page-15-11?search=8379)

If eligible to file the Injured Spouse Allocation form, send it along with your federal income tax return whether e-filing or paper-filing. Be sure to write “Injured Spouse” in the top left-hand corner of the tax return. Here in Pennsylvania, taxpayers must paper file the PA State Form 8379 to the Tax Advocacy Office – not where one sends their tax return - prior to either paper- or e-filing a state income tax return. Check with your tax professional to determine the proper procedures in your state, so your tax return doesn’t become injured as well.

The Mobile CPA

http://www.themobilecpa.net