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#114420 - 06/09/06 04:07 AM Complicated Tax Refund Split Question
kaliphonia Offline
recently joined

Registered: 06/09/06
Posts: 2
I have a somewhat complicated tax refund question. Hopefully I can explain it fairly simply and someone can help.

Here are the facts:

My ex-wife and I divorced in February of this year (2006).

Back during our first pre-trial conference it was decided that all financial debts and assets would be separated as of July 10, 2005 (date of "separation").

My ex-wife did not make any of her estimated tax payments for 2005.

Our Marital Settlement Agreement stipulated that I would be responsible for filing of the 2005 tax return, plus all additional taxes due up to $3,000. Any amount due over $3,000 would be paid 50/50 by both of us.

$1500 was put into a trust by me, to be dispersed to her upon final filing of the tax return, as if she OWED anything, it could come out of this money.

The Marital Settlment Agreement also states (under Divesting of Property Righst: Mutual Releases) - "Except as expressly provided in this Agreement, each party accepts the property herein in full satisfaction of all property rights and all obligations existing out of the martial relationship of the parties."

Here is the issue:

I filed our tax return jointly, and a tax refund was owed by both the State and Federal Government. A refund of roughly $1800 total was directly deposited to my account.

My ex-wife is now sending me letters saying that I owe half of the refund to my ex-wife.

Is this true? The Marital Settlement Agreement stipulated that I pay all taxes due, which I did. The way I look at it, I paid too much in taxes (as my withholdings were higher than they should have been), and the tax refund was simply a reimbursement for my overpayment in taxes.

Do I absolutely owe this money to her? Do I absolutely not? There is nothing mentioned in the Agreement saying what happens should there be a refund, but it DOES say that I am responsible for anything due up to an additional $3,000. It also states that she has no right to ask for any additional monies, as it was agreed in the Agreement that the Financial Disclosure Statements represented all marital property.

Should I pay her? Should I refuse to pay? What would happen if I don't pay? Is worst-case-scenario that she would have to take me to small-claims court?

I don't want to have to enlist the help of an attorney on this, as it would cost me more in legal fees than is worth it. On the other hand, I don't feel like handing over $900+ if it is unwarranted - this seems near harassment to me, as I have now received 4 letters regarding this matter.

#114421 - 06/09/06 05:06 AM Re: Complicated Tax Refund Split Question [Re: kaliphonia]
Gecko Offline
Carpal \'Tunnel

Registered: 06/02/04
Posts: 20602
Loc: Third rock from the sun
I would tell her to go suck an egg. Since she failed to make her estimated tax payments, you had extra monies withheld to cover them and what you thought you were going to have to pay and you paid in too much. If she wants to sue you and pay your attorney's fees when she loses...which she will because of the Mutual Release she signed, that's her choice.
If you air your dirty linen in public, expect people to comment on the skid marks!

#114422 - 06/09/06 05:12 AM Re: Complicated Tax Refund Split Question [Re: Gecko]
kaliphonia Offline
recently joined

Registered: 06/09/06
Posts: 2
That's pretty much my response as well. I think I will send her attorney a letter simply stating that I had higher deductions on my paycheck taken out ahead of time to cover the fact that she was not paying her estimates, and that all money refunded was simply a refund on my overpayment.

I will then remind them that the Agreement stipulated that no additional money is owed, citing the Mutual Releases clause.

I figure, worst case scenario, she takes me to small claims court over it and I represent myself - and she ends up spending a fortune on legal fees to try to get $900.

Of course, if anyone reads this and thinks this is a really BAD idea, please let me know!

#114423 - 06/11/06 08:50 AM Re: Complicated Tax Refund Split Question [Re: kaliphonia]
jaiye Offline
old hand

Registered: 10/28/05
Posts: 860
I hope that you realize that she can file an amended return as married filing single and really mess things up for you.

#114424 - 06/11/06 12:49 PM Re: Complicated Tax Refund Split Question [Re: jaiye]
Buckeye Offline
Carpal \'Tunnel

Registered: 12/08/05
Posts: 7873
Loc: OH
But, if she did that, she would have to pay her unpaid estimated taxes.

#114425 - 06/22/06 06:03 AM Re: Complicated Tax Refund Split Question [Re: kaliphonia]
Maury Offline
Carpal \'Tunnel

Registered: 06/02/04
Posts: 8182
Loc: This Asylum --->
In my estimation, you are out of luck if you filed a joint return. That should have been addressed in the divorce.


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