We just received from the IRS some rather frightening information. It would seem that we have a cancellation of debt that Mark never added to the 2006 income tax return, what does this mean? It means we have to add on 40,000 to the amount of our taxes, this means we owe the government $8,000.00. I want to cry because I always knew Mark was a really bad when it comes to bills, I knew this and I recall the bill coming in the mail, when I questioned him about it he refused to listen to me, this happens quite often, so I am not really surprised that it is now an issue. It took me a very long time to pay off my student loan because he just didn’t choose to make payments on them. The part that is scaring me beyond all reason is that I now have new student loans out and if he doesn’t make the arrangements with them to make some kind of payments I may lose my government funding. The even more frightening thing is that the bill for the cancellation of debt is in my name, my credit has always been better than Mark’s, or it was until we got married. (sigh) This means I am firstly accountable for all the debt and ta da, we are getting divorced!
I am not going to allow myself to get angry about this, it’s a wasted emotion for one, and it really is my fault as well as his. I recall the letter, I just let Mark handle it and I really should have known better. I accept that this is my problem to deal with, not sure how I will deal with it but I know I will do what needs done. I may end up eating crackers and cheese for the next 30 years but I will pay off this debt. I am now wondering if I should still get my computer. The $600 is a drop in the bucket and desperately need the computer if I am going to succeed in my schooling, I am confused and worried but I know I will find a way to work it all out. At this point I am feeling a little numb and sad, but I know I will come up with a payment schedule with the tax people and work it out that way, I hope. At this point I am deciding that my need for the computer is more integral than ever to my future and I think I will get it, but I am very conscious now of my need to get a job as soon as possible. On the other hand the money for the computer could start me on the right foot with the IRS and showing them I am willing to work with them, damn..I don’t know what to do.
My biggest fear is if they decide to cancel my current student loans as a result of this debt on the books. I would not have the funds to pay them in the amount they would want…I don’t know what to do…To say I am scared would be mild.
Bekki
You’ve got a lot on your plate, hon. Sorry to hear about more complications to your life.
The most important thing in tax situations like this is to let the IRS people know that you want to work something out with them rather than defaulting on your tax obligations. A reasonable plan should be able to be worked out, I would assume.
**hugs**
Bekki,
I’m sorry. For some reason the beginning of my comment didn’t post. Here is the full comment. Please delete the one above this.
You might qualify for Innocent Spouse Tax Relief. If this eligibility explorer doesn’t give you enough information, contact the IRS and ask specifically about Innocent Spouse Relief.
There’s also something called an injured spouse claim. This is from the IRS website:
I don’t know if any of this will help you, but it’s worth checking into.
I am going to contact Chrysalis Women’s Center here in Minneapolis — the one I so highly recommend for women having relationship problems, legal problems, financial problems, etc. — and see if they know of a comparable organization in the Orlando area. Frankly, you could use a good helping of competent, professional, affordable advice about the issues you’re facing.
Lottie: I am not sure this applies to me hon, but thats for checking into it for me.
Bonnie: I think I am just as responsible for the debt as Mark, after all I did know about it.
Thanks for the advice guys but I think, in the end it’s going to come down to paying the tax equally. I hope they allow me to make payments on it over time, if they do I will be fine.
I’m sure you’ll be able to make payment arrangements. Even when all I owed was $900, they let me pay it out. Besides, they benefit from payment plans too; they get to charge interest.
Sorry for all you’re dealing with, Bekki. I wish there was something I could do to help.
Thing is Lottie, I am glad this happened it was an area I was not paying enough attention to, some of my bills will have to be paid and by me. I have up until now not really focused on this, I need to and soon. I am after all going to be a bill paying member of society. Part of this is my own error, though Mark refused to let me pay bills while we were married I should have gone ahead and checked out what we owed and who we owed it to. I am learning and growing..this is another lesson! I am not afraid to face what I do not know, it’s not ignoring that there is one that causes problems. Next lesson I am thinking will be having a bank account..
If you can afford it, try to budget a small amount of money per month to a savings account for an emergency account. Life is very unfair! Since we know that, try to expect it by having some money set aside for life to happen. God Bless!
http://www.beatingdebt.wordpress.com
Thats a very good idea. Thanks for the suggestion..I plan to do just that.
The 52-year-old experienced woman that is me can’t help but be concerned that you don’t have a lawyer involved in this divorce in some capacity considering the financial and child custody issues involved. Sure, you think it’s all worked out now because you and Mark are “friends,” but I’m very concerned that this decision is going to turn around soon and bite you in the ass in a big way. I hope it doesn’t, but I’m expecting it to happen without the legal agreements in place.
Your Blunt Friend in Minnesota
Bekki,
I agree with Bonnie on this. I know, first hand, how hard a “friendly” divorce can bite, and how long it takes the bite wounds to heal (if they ever do).
You need someone representing you and your interests.
Sorry to butt in, but I’ve been there (without legal representation and getting by behind kicked without even realizing it) and I would never wish it on another person. Especially someone as nice as you.
Exactly, Lottie. I’m not saying this to be mean or antagonistic or pessimistic; I just don’t want to see bad things happen to good people. And “bad things happening to good people” is so likely to happen as a result of “friendly” divorces with no legal representation when child custody/child support issues are involved and liability for any mutual debt that may crawl out of the woodwork. Think real hard about this, Bekki, before you proceed with this do-it-yourself divorce and then have little legal recourse for any consequences.