There are different “filing status” options for a person filing a tax return. The options include: single, married filing jointly, married filing separately, head of household, or qualifying widow. In order to file a tax return as a married person, you must have been married on the last day of the tax year (December 31st). Divorce cases often last several months or sometimes years before the divorce is final, during which time the parties are still married. Therefore, a couple in the middle of a divorce may choose to file a joint tax return.
Filing a joint tax return often (though not always) saves a couple money on the amount of taxes that they owe. The downsides of filing a joint tax return are that it requires both spouses to agree to it and that each spouse will be jointly and severally liable for the taxes. Joint and several liability means that either party can be held liable for the entire tax burden should the other party fail to pay. The IRS offers some protection against this, for the “innocent spouse.”
Agreeing To File Jointly
Usually both parties must agree in order to file a joint return. In New Jersey, however, one spouse may be forced to file a joint tax return. In Bursztyn v. Bursztyn, the court set forth five factors to examine to determine whether it can compel a party to file a joint tax return. First, the court will see whether there is a financial benefit to filing a joint return. Next, it will look to see if there is evidence of previous fraudulent tax return. Next, it will consider whether the person wishing not to file a joint return earned income during the marriage and ascertain the reason why he or she does not wish to file a joint return. Finally, the court will determine whether there are enough assets to permit the couple to cover the cost of filing separately. Continue reading