Comments on Legal Tips & Commentary: Discharging Tax Debts Through Bankruptcy

Always remember that banks or other financial inst...

2009-04-03T03:01:00.000-07:00

Always remember that banks or other financial institutions never call or send an e-mail to ask for your password information. Be cautious at all times to prevent credit card fraud. After all, you wouldn’t want to see an unexpected large credit card debt on your bill in the future.

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emmamilson
Credit Card Debt>

Here's my situation: My ex-husband and I divorced...

2006-01-19T13:54:00.000-08:00

Here's my situation: My ex-husband and I divorced over three years ago. As part of the settlement we were supposed to share the IRS debt. He wasn't paying any of the bill, but I was sending in checks. He then filed Chapter 13 bankruptcy. After he filed, the IRS no longer withheld any of my refunds, etc. I have had no contact with him over these years, and I believed that the IRS debt was part of the past. However, now he has filed a lawsuit against me claiming I was completely uncooperative in repaying the debt. I have my cancelled checks to show that I had been paying. He's suing me for more than the original debt. What are my rights?

The MSA is essentially a contract between you and ...

2005-06-21T15:21:00.000-07:00

The MSA is essentially a contract between you and your ex husband. I do not believe An MSA can alter the creditor's rights, it only governs the relationship between the former spouses.

You have been stuck paying the debt to the extent the IRS has taken your tax refunds. You might be able to reopen the divorce case and obtain a modification to the MSA that compensate you for those losses.

Thanks. Maybe I can clarify some, as this is my o...

2005-06-21T14:40:00.000-07:00

Thanks. Maybe I can clarify some, as this is my own situation.

We divorced at the end of 2001. In April 2001 we filed married, jointly, posting a very large IRS debt. Our California Marriage Settlement Agreement stipulated that in lieu of paying me alimony or spousal support, my exhusband would pay the IRS debt. I personally have not made any voluntary payments towards the debt, though I have in the past lost several federal tax returns to it. The IRS chose not to honor the MSA, however, and since then I have been receiving balance due notices. My ex, however, had been paying the debt on installments, and $35k remained at the time he filed for Chapter 7 at the end of 2004. He claimes he received a discharge notice for the debt from the IRS that was addressed to both of us, but I haven't received anything myself other than another balance due notice. I'm waiting for him to send me a copy of the discharge notice but in the meantime I'm quite worried that I'm liable for this debt. I don't expect to be reimbursed for anything and don't intend to pursue reimbursement - I just don't want to get stuck with anything.

Thanks for your advice!

Assuming that it is truly a dischargeable tax debt...

2005-06-21T10:07:00.000-07:00

Assuming that it is truly a dischargeable tax debt, the wife would not automatically receive a discharge of the debt. However, the husband may not be completely off the hook because the former wife might have a nondischargeable reimbursement claim if the former wife had to pay the tax debt.

It sounds like the husband assumed liability for the tax debt under a maritial settlement agreement. Section 523(a)(15) of the Bankruptcy Code sets forth restrictions on the dischargeability of debts assumed from marital dissolution proceedings. The former wife should consult with an experienced bankruptcy attorney to discuss the facts of her case to see if she has a valid reimbursement claim.

Question for you: if a married couple files jointl...

2005-06-20T22:30:00.000-07:00

Question for you: if a married couple files jointly with a large IRS debt and then divorces, and the husband agrees to take the debt as part of the settlement agreement but then later files Chapter 7 bankruptcy and gets the IRS debt discharged, is the wife still liable for that IRS debt or is it discharged from her as well?