On an income tax return with a filing status of “Married Filing Jointly,” it is possible for the refund of one taxpayer to be withheld by the IRS to pay the debt of the other taxpayer.
The taxpayer whose refund is being applied to their spouse’s debt is referred to as an “Injured Spouse.”
The IRS (and some states) provide a method to protect the injured spouse’s refund. It requires the filing of Form 8379-Injured Spouse Allocation. The form provides the opportunity to allocate the income, deductions, exemptions and credits between the spouses. The injured spouse can even request that their “protected” refund be issued in a separate check and mailed to a different address than the address on the income tax return.
The most common debts involved in an injured spouse situation are unpaid child support, delinquent student loans, unpaid federal and state income taxes and unpaid public defender fees.
We have a great deal of experience with taxpayers needing this protection and have a long record of success in helping injured spouses protect their refunds from their spouse’s debt.