Frequently Asked Questions (F.A.Q.)

 

Question:  I am married but I file single because my spouse owes child support or owes the IRS for back taxes.

Answer:  If you are married and live in the same household with your spouse, your only appropriate filing status is either married filing jointly or married filing separately.  Also, you may be filing at a much higher tax rate if you file as single or married filing separately.  The solution to this problem is to use the appropriate filing status, which is married filing jointly, and file Form 8379 which is referred to as “injured spouse relief”.  Filing this form will allow you to get your share of the refund, if any.  Remember, using the “married filing jointly” status will likely mean filing at lower tax rate which means a bigger refund and you will get your share of that refund while your spouse will reduce his obligation for child support or back taxes owed to the IRS.  Sounds like a “win win” situation to me.

Question:  I want to file bankruptcy and wondering if it will wipe out my tax debt owed to the IRS?

Answer:  Not every year of tax debt owed to the IRS will be wiped out in a bankruptcy proceeding.  Generally, it will depend on when the taxes were filed and when you file for bankruptcy.  The best thing to do before considering the bankruptcy proceeding is to talk to a tax professional like Benson Associates.  We will provide you with options that will result in a better outcome.

Question:  I have heard about this IRS program called the “Fresh Start Program” What is it and how can I apply for it?

Answer:  The “Fresh Start Program” is an initiative launched by the IRS that allows you to settle you tax debt for far less than what you owe.  It is offered through the “offer in compromise” program.  If approved, you will be allowed to settle the reduced amount in a lump sum or monthly payments.  Call us for a more detailed explanation and see if you qualify.