With the June wedding season winding down, many newlyweds are beginning to sort out their finances as married couples. It’s important to get it right. As several Answer Desk readers have found, things can get a little complicated down the road if you’re not entirely clear about your marital status.
My exboyfriend and I filed our 2004 taxes jointly (we were still together at that time and owned a house together). Since then, we have separated and when I filed my taxes for 2005, I was told by the man from H & R Block that I had to file married filing separately because filing our taxes together made us married. He also said that I need to get a divorce. Is this true? ... The guy at H&R Block said that filing our taxes together made us legally married. We never had a wedding or a marriage license, I never got a ring and he never even asked! Wonder why he’s out of the picture now.
-- Crystal, Montana
You need to see a lawyer who specializes in Montana family law. When it comes to financial questions related to your legal marital status, we don’t suggest relying on advice from some guy you’ve never met who writes a column on the Internet. (Then again, we don’t suggest you rely on the guy at H&R Block either.)
But from what we can tell, it looks like you’re not married – and never were. Just filing a joint return doesn’t make you married.
Which means you may have to go back and file an amended return for 2004 – as an individual. In order to claim marital status and file jointly, the IRS saysyou need to meet at least one of these tests:
- You’re married and living together as husband and wife.
- You’re living together in what’s known as a “common-law marriage” — a legal marital status recognized by a handful of states.
- You’re married and living apart, but not legally separated under a divorce decree or separation agreement.
- You are separated under a divorce decree that’s not final.
Since Montana is one of those states that recognize common-law marriage, you’re best shot at claiming joint filing status for 2004 is No. 2.
But according to the Montana Department of Public Health and Human Services, you have to meet four more conditions (all of them) for your common law marriage to be legal there:
- You have to be “competent” to marry — which means you’re old enough, you aren’t married to someone else, and you aren’t a close blood relative of your intended spouse.
- You both have to agree to be married.
- You have to live together as husband and wife.
- And you have to tell other people — like friends, family and neighbors — that you’re married.
Since he never popped the question (never mind the ring), it sounds like you flunk Condition No. 2. And unless he went around telling family and friends you were married (we’re guessing that one’s a stretch too), it sounds like you don’t meet Condition No. 4 either.
But you clearly need to resolve this one way or another. So go see a lawyer. If it turns out you are, in fact, married, he can help you with a divorce.
I was legally married in 1991. We legally divorced in 2002 (in Colorado). We are living together again in Colorado. According to two lawyers we've spoken with, Colorado law says we are legally married and (we) would have to move apart and get another legal divorce to be considered unmarried. Am I obligated to file taxes as "married," or since I got a legal divorce, can I file them "single"?
-- Karen B.,Aurora, Colo.
Colorado is another state that recognizes common-law marriage, so if you meet the conditions, you may have gotten married again — even though you didn’t arrange a formal ceremony and sign a marriage license. But don’t assume you’re married just because you’re living together.
If you do meet the conditions for common law marriage, you would have to get divorced — again — to file as a single taxpayer. According to Findlaw.com, “When a common-law marriage exists, the spouses receive the same legal treatment given to formally married couples, including the requirement that they go through a legal divorce to end the marriage.”
Whether or not you get a divorce is entirely up to you. But until you do, if you meet the conditions for common-law marriage, you’re married in the eyes of the IRS.
To be considered unmarried by the IRS, you have to be legally separated from your spouse under a divorce or separate maintenance decree on the last day of your tax year (usually Dec. 31.) State laws governing those court proceedings ultimately determine your marital status, according to IRS Publication 501.
You may have one more way out. You can be “considered unmarried” by the IRS if you meet four more conditions (all of them). You have to have:
- Filed a separate return,
- Paid more than half the cost of keeping up your home during the tax year,
- Had a child, stepchild or foster child for more than half the year and can claim them as an exemption and
- Your spouse can't have lived in your home during the last six months of the year.
If all of these apply, the IRS says your standard deduction will be higher and you may owe less tax. You may also be able to claim the earned-income credit and other tax credits.
On the other hand, if you’re still legally married, you can choose whether or not to file jointly —if your spouse agrees. But there are two more reasons you may want to file separately:
- You may not want to liable for spouse’s taxes
- You may owe less tax filing separately.
Again, you really need to see a good lawyer who specializes in your state’s family law to find out once and for all whether you’re married. If you are, filing a tax return is just the beginning. If you’re married, you could be held liable for a spouses debts, find yourself defending a claim against your house or other property or even owe your spouse a portion of your retirement benefits.
So it’s best to get that lawyer to determine whether or not the knot is officially tied or untied — before things get really tangled.