Is a divorce reported to the IRS?
April 2, 2016 10:07 AM   Subscribe

If you get a divorce, is that automatically reported to the IRS?

Long story short, my wife and I thought that we were divorced, but it turns out there we aren't. During the time when we thought we were single, we've been filing our tax returns as single, not married.

Soon, we will be officially divorced. Unofficially, a tax person told my wife that if we amend our tax filing for those years to Married Filing Separately, we'll get hit with some fines. This seems ridiculous, since we would not owe the IRS any additional money no matter how we had filed during that time period. We would also fall within the three year time period that you get to file amended returns.

The tax person told us to let sleeping dogs lie, which I'm fine with. However, I'm concerned that when we do get divorced, something will go to the IRS telling them that we got divorced, and thus have been married (and filing incorrectly) this whole time. Is this a silly fear? YANML, YANMA, etc.

Thanks!
posted by Fister Roboto to Law & Government (7 answers total)
 
You need to talk to a grown-up tax person, officially. As a general rule, if a change in the information provided on your tax return doesn't change the tax owed, and you otherwise filed and paid on time, you should not have to pay any more. Tax procedure itself is not supposed to be a revenue device. But that is a general rule.

Tax fraud is a serious matter. You didn't commit it at the time (no intent), but you'd be running the risk now that you know, if you actually owe the IRS now. Do you really want this hanging over your head for the entire statute of limitations period? What if one of you needs to have a background investigation done in connection with government employment or contract with your employer? Clear it up and you'll be happier.
posted by praemunire at 10:15 AM on April 2, 2016 [6 favorites]


There is a difference between negligence and fraud. That matters in how the IRS will assess fines. Right now, you have a negligence error, a mistake. If you hide that error to avoid fines, then you start getting to the fraud errors. Don't do that.

Call a CPA tax preparer and have them amend your returns.
posted by 26.2 at 10:44 AM on April 2, 2016 [5 favorites]


Unofficially, a tax person told my wife that if we amend our tax filing for those years to Married Filing Separately, we'll get hit with some fines. This seems ridiculous, since we would not owe the IRS any additional money no matter how we had filed during that time period.

Are you sure? When you're married filing separately, you are ineligible for certain deductions that might be available to you were you either married filing joint or single. I agree that you need to talk to a CPA in an official capacity.
posted by PhoBWanKenobi at 11:18 AM on April 2, 2016 [2 favorites]


To answer the actual question: no, I don't believe the IRS gets notified.

I did amend a return during my divorce because I learned that it would increase my refund by like a thousand dollars that year. I did get the check, but only after my ex amended his. They initially rejected the amendment because itbdid not concur with his.

So, you both need to file an amendment for it to be accepted, apparently.

I would go ahead and talk to a tax professional.
posted by Michele in California at 11:44 AM on April 2, 2016 [1 favorite]


Okay. Yeah, I'm going to talk to a CPA. Well, I just did, actually, but I'm going to go in and see one.

He said that the only way we would get fined is if out tax liability went up for filing Married Filing Separately as opposed to Single, but he thought that was very unlikely. So, I don't feel like there would be any fines, but I'd rather just get this taken care of and know for sure.

Thanks for scaring me straight!
posted by Fister Roboto at 11:48 AM on April 2, 2016 [3 favorites]


Depending on the error that led you to think you were divorced, you should also talk to your lawyer and your tax professional about the possibility of a nunc pro tunc divorce judgment where the judge enters a divorce judgement "now for then." You'd have to find out if that is possible, if it fixes your tax issue, and whether it causes any other new problems.
posted by Jahaza at 12:50 PM on April 2, 2016 [4 favorites]


If you update your federal taxes retroactively, your state will find out too... eventually. They do sync up, but sometimes years later. So if you owe a bunch to the IRS, you may get a nasty letter from your state in 2-3 years demanding their share too.
posted by miyabo at 1:51 PM on April 2, 2016


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