Filed MFJ but never married

[Pacun]

Client came this year to me. He lives with his girlfriend and filed 2006, 2007, and 2008 as MFJ because tax preparer suggested. We ended up filing as single for 2009 without any itemized deductions.

In 2007 and 2008, IRS charged them taxes and penalties because they claimed too much in 2106 deductions that couldn't prove.

He has an immigration case that will go in front of a judge in August and his attorney sent his taxes to a preparer to give an oponion if taxes were prepared properly. In the letter, sent to the attorney and then given to the client, tax preparer states that he is single and therefore he should NOT file his taxes as married. ALSO immigration doesn't recognize common law marriages and attorney wants taxes to correctly match his status in front of the immigration judge. Tax prerarer also questioned his 2106 deductions and asked him to amend all years except 2009 that I prepared. (remember IRS already charged taxes and penalties for 2007 and 2008).

I know that you cannot change form MFJ to MFS after April 15. In this case, I will be amending from MFJ to single. Is that possible? How do I amend a return that has already been changed by the IRS? If I amend the copy that the client gives me, IRS might charge him again for something that was already paid.

[ILLMAS]

Client came this year to me. He lives with his girlfriend and filed 2006, 2007, and 2008 as MFJ because tax preparer suggested. We ended up filing as single for 2009 without any itemized deductions.

In 2007 and 2008, IRS charged them taxes and penalties because they claimed too much in 2106 deductions that couldn't prove.

He has an immigration case that will go in front of a judge in August and his attorney sent his taxes to a preparer to give an oponion if taxes were prepared properly. In the letter, sent to the attorney and then given to the client, tax preparer states that he is single and therefore he should NOT file his taxes as married. ALSO immigration doesn't recognize common law marriages and attorney wants taxes to correctly match his status in front of the immigration judge. Tax prerarer also questioned his 2106 deductions and asked him to amend all years except 2009 that I prepared. (remember IRS already charged taxes and penalties for 2007 and 2008).

I know that you cannot change form MFJ to MFS after April 15. In this case, I will be amending from MFJ to single. Is that possible? How do I amend a return that has already been changed by the IRS? If I amend the copy that the client gives me, IRS might charge him again for something that was already paid.

I don't think it should be a problem at all correcting it, just make sure you use the most recent figures (IRS corrected figures) as orginally filed. Then you will need to prepare two 1040X, one for each taxpayer as single, this can look a little tricky because you are going to be using "as orginally filed (IRS corrected)" figures for each taxpayer, but once you report "as corrected" for each taxpayer, everything should balance out and there is a chance they will owe money ontop of what they paid already. I see this way, the changes to 2106 deductions was a problem that was resolved already, the only thing you have to do is allocated the expenses to the proper taxpayer. I would do this, I would recreated the MFJ tax return with the IRS figures, then I would prepare two single returns and just make sure 2106 figures match with the IRS, hopefully it's only one of the taxpayer that has 2106 expenses, would make it a lot easier.

MAS

[jainen]

>>an immigration case that will go in front of a judge in August<<

Remember that it normally takes four months or more to process an amended return. This taxpayer needs some extra service. I would call tax practitioner hotline for advice on how to get the amended returns at least acknowledged before the hearing. Immigration can be unpredictable. They might just shrug it off, or they might get really upset about years of obviously false tax returns. Work with the client's attorney on the presentation. In my opinion, this is high-stakes professional work that deserves a reasonable fee.

[Pacun]

>>an immigration case that will go in front of a judge in August<<

Remember that it normally takes four months or more to process an amended return. This taxpayer needs some extra service. I would call tax practitioner hotline for advice on how to get the amended returns at least acknowledged before the hearing. Immigration can be unpredictable. They might just shrug it off, or they might get really upset about years of obviously false tax returns. Work with the client's attorney on the presentation. In my opinion, this is high-stakes professional work that deserves a reasonable fee.

Thank you for the advice.

[Pacun]

I am doing these amended returns but I have some questions and maybe someone has done this before.

Originally filed MFJ got a refund for 5K. On the amended return, the refund for MAIL filing as single is now $2,700 and FEMALE refund is $300. How do I distribute the refund they got when they filed jointly? Should I include $2,500 for each? Currently my 1040X reads that MAIL owes $3,300 and FEMALE owes $4,700. Someone will have to pay $2,000 to the IRS which is the net result.

FEMALE made 10K in wages and MAIL $60K. FEMALE's 1098 shows mortgage interest for $28,000. MAIL and FEMALE are in the title of the house but she is the only one in the loan. Since he is 50% owner of the house, should I deduct some mortgage in his schedule A? He was the ONLY one who paid all this interest but I want to be very conservative. I would go with half or zero mortgage interest for him, what do you think?

[jainen]

>>she is the only one in the loan<<

That probably means he was added to title AFTER the loan. If so, he is not obligated to pay and can't even claim he is protecting his (subordinate) interest. He can not deduct the mortgage payments, but it's not too far out to claim the deduction on HER return, since he was apparently making payments in the nature of a gift to a loved one.

If you didn't need to be very conservative and not risk an audit (which you would probably win anyway), you should be able to allocate the refund according to taxable income and/or payments.