tax return signed without spouses knowledge

[jondoe]

Let me be clear this is not about me.. I know many post scenarios like this but Im asking to help a friend out who is extremely stressed out not thinking clearly.

I was talking with "X" who is having problems with their soon to be ex-spouse "Y" and found out for approx 10 years Y was signing X's name on joint tax returns. There is no verbal agreement or power of attorney giving Y permission to sign X's name. Y leaves X out of all family/household financial affairs, nothing is in their name not even their automobile! X had no knowledge of returns being filed as Y is "retired" where all income comes from investments (approx $100K/ month! X wasnt even aware of this until after meeting with their divorce divorce attorney!! This should tell you how secretive Y is) They have been together for 15 years where this was taking place for the first 10.

IMO Y hs been doing this to hide money from X, they dont want Y to know anything or even know what they are worth. I dont think there is any criminal activity making X signs Y's name, just simple keeping X in the dark on investments, property owned, income & net worth. Y did tell X that no one will ever come between them and their money!!!

Ok that said what are the legal ramifications for Y? Is Y potentially guilty of any type of identity/tax fraud that is not limited to the statute of limitations (federal level)? What kind of tax liability/ possible criminal liability is X on the hook for by Y signing their name on tax returns, if Y has in fact reported some false information in their returns?

Is this a simple case of identity fraud that X could file against Y?

 

[OHRoadwarrior]

Nope. Unless X has been legally judged a moron, they have been accepting this behavior. Methinks the lady doth protest to much. The statute of limitations appears to have flown for any recourse X may actually have had. The IRS might be interested, however, X has no proof she did not sign anything.

 

[stealth2]

Didn't it occur to your friend that they needed to be filing tax returns?

 

[ajkroy]

So, did X just figure that taxes weren't being filed at all during those 10 years? If she had been filing her own joint returns, I'm sure she would have heard from the IRS before now.

 

[nextwife]

Seriously? For ten years she herself did not file, but says she`s clueless about his filing?

 

[jondoe]

Clearly a few of you didnt read what I posted... for those that offered "answers" what is you legal background? What field of law do you practice; family law, tax law etc?

 

[Zigner]

Clearly a few of you didnt read what I posted...

I'm sure they all did.

 

[Silverplum]

Clearly a few of you didnt read what I posted... for those that offered "answers" what is you legal background? What field of law do you practice; family law, tax law etc?

Firstly, I can see that you didn't read.
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Secondly, it doesn't require a law degree to form an opinion about a story, or about the characters in that story.

Thirdly, if you want to deal only with tax and or/legal professionals, go to a tax attorney and pay for the consultation.

 

[wavehopper27]

I am not an attorney but I will freely offer advice, symapthy, distain, support, apathy, sorrow, mocking, bad jokes, sarcasm, information and other such things free of charge.

Accuracy will cost you.

 

[tranquility]

Nothing is "simple" in something like this. Such accusations happen all the time in divorce. Without all the facts, who can even hazard a guess. Since X had the legal duty to file a tax return for those years (If the family made enough money to live, this is likely.), what is her excuse for intentionally not doing so?

Saying "I didn't sign." is not a tap-tap get out of jail free card. There are things such as innocent spouse relief for some of what you talk about, but, I'm not seeing how that is beneficial under the facts stated. Identity theft? Um...sure. Tell it to the cops. They might tell you to report it to the IRS. Someday, someone may investigate it. But, it is not going to make things easier for all the parties. And, it will not have any effect in the near term. It will just add a complication until or unless there are some damages. Even then, there is not a rapid assault team standing by to do a complete investigation of a wife going through a divorce who says she didn't sign her tax returns for a decade.

 

[LdiJ]

Clearly a few of you didnt read what I posted... for those that offered "answers" what is you legal background? What field of law do you practice; family law, tax law etc?

I am a tax professional. The question about whether or not X should have known that tax returns were not being filed or that his/her signature was being forged is a valid one that the IRS WILL ask if its necessary to involve the IRS.

However, if X has had no income during the past 10 years then it would have been completely valid for X to have assumed that his/her spouse was filing married, filing separate returns...which the previous posters did not take into consideration at all in their responses. If X had no income X would not be required to file a tax return.

Whether or not this ends up being a problem that is actionable depends on different factors. As long as all of the tax liability was paid and there was no "funny stuff" on the return other than the fact that it was a joint return, then X has no liability towards anything to worry about. However, if the taxes were not paid in full and/or get audited in the future, there could be problems for X.

The first thing that I recommend that X do is contact the IRS and ask for tax return transcripts for those 10 years. Not only will it allow X (and any professionals he/she chooses to use) to see exactly what was done with the taxes, it will also provide a great deal of information regarding Y's assets.

 

[tranquility]

I am a tax professional. The question about whether or not X should have known that tax returns were not being filed or that his/her signature was being forged is a valid one that the IRS WILL ask if its necessary to involve the IRS.

However, if X has had no income during the past 10 years then it would have been completely valid for X to have assumed that his/her spouse was filing married, filing separate returns...which the previous posters did not take into consideration at all in their responses. If X had no income X would not be required to file a tax return.

Whether or not this ends up being a problem that is actionable depends on different factors. As long as all of the tax liability was paid and there was no "funny stuff" on the return other than the fact that it was a joint return, then X has no liability towards anything to worry about. However, if the taxes were not paid in full and/or get audited in the future, there could be problems for X.

The first thing that I recommend that X do is contact the IRS and ask for tax return transcripts for those 10 years. Not only will it allow X (and any professionals he/she chooses to use) to see exactly what was done with the taxes, it will also provide a great deal of information regarding Y's assets.

True, if there was practically no income. I think the gross amount was $3,700 last year. But, we're talking 15 years ago. We also don't know if this is a community property state and if the STBX income is wholly from retirement and separate property. However, if STBX is pulling in $1.2 million a year in unearned income I'm thinking this is not really going to cause a bunch of sweat.

 

[Bali Hai]

Let me be clear this is not about me.. I know many post scenarios like this but Im asking to help a friend out who is extremely stressed out not thinking clearly.

I was talking with "X" who is having problems with their soon to be ex-spouse "Y" and found out for approx 10 years Y was signing X's name on joint tax returns. There is no verbal agreement or power of attorney giving Y permission to sign X's name. Y leaves X out of all family/household financial affairs, nothing is in their name not even their automobile! X had no knowledge of returns being filed as Y is "retired" where all income comes from investments (approx $100K/ month! X wasnt even aware of this until after meeting with their divorce divorce attorney!! This should tell you how secretive Y is) They have been together for 15 years where this was taking place for the first 10.

IMO Y hs been doing this to hide money from X, they dont want Y to know anything or even know what they are worth. I dont think there is any criminal activity making X signs Y's name, just simple keeping X in the dark on investments, property owned, income & net worth. Y did tell X that no one will ever come between them and their money!!!

Ok that said what are the legal ramifications for Y? Is Y potentially guilty of any type of identity/tax fraud that is not limited to the statute of limitations (federal level)? What kind of tax liability/ possible criminal liability is X on the hook for by Y signing their name on tax returns, if Y has in fact reported some false information in their returns?

Is this a simple case of identity fraud that X could file against Y?

Sounds like Y has X over a barrel.

Since you know so much about X&Y, can you also tell us what X's attorney said about all this?

 

[ecmst12]

I also have a suspicion that someone with such significant premarital investment income would have gotten a prenup.