Injured Spouse

[S T]

I have a client that Married in 2012, and we filed a MFJ tax return with a refund on Federal of $ 3,000+

Well we were just notified that the $ 3,000 refund was applied to a "child support" issue on the new spouse (husband) which was listed as the primary taxpayer. Obviously the Spouse (2nd taxpayer) is "furious"

As I understand it - I now can file in a Injured Spouse Form 8379 - hoping to capture most of the refund that was generated from the Spouse (2nd listed taxpayer-my former client)

My questions are:

Is this the correct form 8379 to file vs the Innocent Spouse Form 8857?

Do we need to file a 1040X (appears like this is not necessary as no changes on the MFJ tax return)

Or, can we simply submit the 8379 form with a cover letter (seems like the instructions state to file as soon as we are aware that the refund was captured for an offset) Appears as though I need only to complete Form 8379 and attach the W-2 forms, 1099 forms, etc

When I complete the 8379 form, it does not provide me with what the amount of refund would be allocated to injured spouse - and one just knows that the Spouse is going to ask for that info - How do I caluclate that amount?? Use the form 8379 - net taxable in Column B and apply the MJ rate less the injured spouse withholding/payments?

Have not had the "pleasure/challenge" for one of these, so guidance would be appreciated

Thanks

Sandy

[Brian EA]

8379 is the correct form. Do not include any attachments. There is room for the client to sign the form. Uncle Sam will figure out the refunds.
If there are dependents involved make sure that you allocate them to whosoever they belong.

[WhiteOleander]

We have done a lot of these in our office. The IRS will decide how much of the refund will be refunded. There's nothing we can do to figure it or speed it up.

[S T]

Brian and White Oleander - Thanks for the confirmation on the 8379 form , is not going to make the "injured spouse" happy that I can not caluclate or give a "what if" on the refund - This particular case/issue - Injued Spouse as a Newlywed at at the end of 2012 is "furious" at the New Husband

Okay - I did not buy into Marriage Counseling --- I can only offer the "tools" to try to do some damage control and obtain whatever refund from the MFJ return which should be generated from the "Injured Spouse"

I so appreciate your posts

Thanks,

Sandy

[WhiteOleander]

Just an example of trying to figure out the IRS..........................
I prepared a 8379 just yesterday for a couple. Wife has defaulted student loans. One child, no EIC. Husband is only bread winner.

I told them that I could not tell them how much of the refund would be sent to hubby. We are in a community property state. I said he may only get half. They said last year he got all the refund. ??????????

I have no idea how the IRS figures the refund.

[S T]

Thanks White Oleander, -- I know I am struggling with this and can not offer any amount to the taxpayer - One would think that the 8379 form or IRS would give us some sort of "clue"

I can just see when the final "refund" is received on the injured spouse filing, that the Injured Spouse is going to say how did they arrive at that "amount"

Hopefully IRS sends a letter to the Taxpayer or Injured Spouse to let them know the "calculations"

I read about the Community Property Tax States, and fortunately this client is NOT one of them

Another one of those "mysteries"

Sandy

[MAJ]

The innocent Spouse calculation

I've done a number of these.

Does the Not-So Innocent Spouse (the one who owes) work? Normally I find that the person who owes $$ always claims a high withholding so they get more of their money in their paycheck. Then the innocent spouse is usually the one who claims Zero or a low withholding figure and gets a huge hit.
The innocent spouse form will reverse that. The innocent spouse should also be sure to have a talk with the not-so-innocent spouse to insure they fix their withholding so the amount actually starts to go down.

It'll will be an annual thing so just make a note in the account.

[erchess]

Mnemonic that works for me

I was confused about Innocent Vs Injured Spouse until someone explained it more or less this way. An Injured Spouse is married to someone who owes money to the government from years in which the two did not file jointly and the debt in question is most often nor originally a tax debt. This post has a classic case, where the not so injured spouse owes back child support. An Innocent Spouse is being dunned for money because she (and it usually is a she) signed a joint return that was found to overstate deductions or understate income or both but she reasonably did not know about those nor did she benefit from the money involved. A classic case would be a self employed person who has a lot of income and only reports the amount spent on living with spouse and not the amount spent on the girlfriend he has on the side. Note that for her to prevail three things are necessary - she did not in fact know, it is reasonable under the circumstances that she did not know, and she got no benefit from the money involved.

[mactoolsix]

Memory tools

Injured – debt occurred prior to the marriage (thus past tense)

Innocent – occurred after the marriage (thus present tense)

Either way, the one causing the problem - will always be a jerk (future tense)

Mike