Does your spouse have unreported cash income? Have you wondered how your spouse reports $20,000 or $30,000 in annual income when you and your spouse live a lifestyle requiring at least $100,000 per year in net income to maintain? If this is you, be very careful with respect to any joint filings of tax returns you file with your spouse. Even if you don't know whether you want to be divorced, be careful about allowing your name to be placed upon income tax returns that you know contain fraudulent income information.
Although we've all heard of the concept of "innocent spouse" protection, which is protection the IRS offers to spouses whose spouses have filed fraudulent tax returns, it is extremely important to realize that that protection is limited. In fact, most spouses do not qualify for innocent spouse protection because they knew that their spouses were filing false tax returns. "Oh, but my name is not on the return!" Or, "oh, I didn't sign the return!" Is not a defense in those situations. Most likely, if you benefited directly in any way from the ill-gotten or the unreported income, innocent spouse protection will not protect you.
More importantly, allowing your spouse to place your name upon fraudulent tax returns "marries you" to the claims made within that document. You're also held to any statements made about deductions, property ownership, etcetera, and judges will not easily "divorce you" from your statements. If this situation seems familiar to you, please contact our offices to discuss how fraudulent tax return filings may impact your divorce case. Turn your fear into power by getting the knowledge you need today.