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Houston Divorce & Marriage Tax Attorneys

If you searched for a “divorce tax attorney” or “innocent spouse attorney,” the issues on your mind are probably the same ones we handle every week. We are Houston tax attorneys, and we advise spouses and divorcing couples on the federal tax consequences of marriage, separation, and divorce — and we represent spouses against the IRS when a joint return goes wrong. This page explains how the rules work and how we help.

Tax Planning for Married Couples in Texas

Texas is a community property state, which changes the federal tax picture in ways that catch couples by surprise. Wages earned during the marriage are community income, half attributable to each spouse, regardless of which spouse the paycheck is made out to. That allocation matters when spouses file separately, when one spouse has a prior tax debt, and when the marriage ends. We have written about how a community-property S corporation election works without both signatures and the surprising places where community property rules show up.

The threshold filing decision is married filing jointly vs. separately. Joint usually produces a lower tax but creates joint and several liability for the entire balance. Separate produces a higher tax but limits each spouse’s exposure. The right answer depends on income split, deductions, anticipated audit risk, and whether either spouse has back taxes or unfiled returns. We walk clients through the calculation before they file.

Property Transfers Between Spouses

Section 1041 generally allows tax-free transfers between spouses and between former spouses incident to divorce. That sounds simple. In practice, the rules turn on whether the transfer is “incident to” divorce, whether it happened within the time windows, and whether the property carries built-in gain that the recipient inherits as carryover basis. A house that looks like a 50-50 split can produce very different after-tax results once the carryover basis and depreciation recapture are factored in.

We have written about whether divorce payments increase basis in a business, the time windows for tax-efficient settlements, and delayed sales to a former spouse. We coordinate with family law counsel to draft settlement language that produces the intended tax result.

Alimony and Spousal Support After TCJA

For divorces finalized after December 31, 2018, alimony is no longer deductible by the payor and no longer taxable to the recipient. Divorces finalized before that date are grandfathered under the old rules unless the agreement is modified to opt into the new treatment. The line between deductible alimony and a non-deductible property settlement depends on the seven Section 71 factors, even though Section 71 was repealed for new divorces. We have written about how payments can qualify as alimony and how a lump-sum payment may not.

Child support is never deductible or taxable. Where the agreement combines support and alimony, we make sure the document distinguishes them so the IRS does not recast deductible amounts as non-deductible.

Divorce Planning When One Spouse Owes Back Taxes

A spouse with an IRS balance complicates everything. Refund offsets, joint return collection, federal tax liens, and community property exposure all come into play. We help clients with divorce planning when there are back taxes, structuring transfers so they do not become fraudulent conveyances under Texas law or under the federal tax lien rules.

Where one spouse plans to transfer property to the other to “escape” the IRS, the answer is usually that it does not work. We have written about transferring property after an IRS lien and the related question of transferring property to avoid IRS collections. The IRS has a long memory and a longer reach.

Innocent Spouse Relief Overview

When a joint return is filed, both spouses are jointly and severally liable for the entire balance, even after divorce. Section 6015 gives certain spouses a way out: innocent spouse relief. There are three flavors: traditional relief under Section 6015(b), separation-of-liability relief under Section 6015(c), and equitable relief under Section 6015(f).

Each flavor has its own elements, time limits, and evidence requirements. Traditional relief requires showing that the requesting spouse did not know and had no reason to know of the understatement. Separation of liability allocates the balance between the spouses based on who earned the income or claimed the deduction. Equitable relief is the catch-all where the other two do not fit. We have written about the factors the IRS and Tax Court weigh and a recent expansion of relief by the Tax Court.

Qualifying for Innocent Spouse Relief

The biggest misconceptions about innocent spouse relief are that the requesting spouse has to be morally blameless and that the spouses have to be divorced. Neither is correct. The Tax Court has granted relief to spouses who knew about a portion of the issue but not the full extent, to spouses who are still married but living apart, and even to a spouse’s deceased spouse’s estate. We have written about how the relief can apply to one’s own income in narrow circumstances and how refund claims work after relief is granted.

The IRS uses Form 8857 as the gateway. The form looks simple but is the foundation of the case, and answers given on the form set the narrative for the rest of the relief request. We help clients fill out Form 8857 with the relief request properly framed from the start.

Separate Liability Relief in Community Property States

Section 66 provides a separate, lesser-known remedy for spouses in community property states like Texas who filed married filing separately rather than jointly. Under the right facts, Section 66 disregards community property income allocation when one spouse did not know and had no reason to know of the other spouse’s community income. This relief comes up regularly in Texas divorces because the default community property rules can push half of one spouse’s income onto the other spouse’s separate return.

Injured Spouse Claims

Innocent spouse relief is different from injured spouse relief. An injured spouse claim, filed on Form 8379, recovers the requesting spouse’s share of a joint refund that was offset against the other spouse’s separate debt (back taxes, child support, student loans). We file these claims routinely as a quick first step while we evaluate whether a longer innocent spouse case is needed.

Business Interests, Partnership Returns, and Divorce

When one or both spouses own a business, divorce raises additional questions: valuing the business, allocating distributions, dealing with carryforwards, and unwinding entity structures that were tax-efficient when intact but problematic at separation. We have written about taxes and flow-through entities in divorce and routinely advise on S corporation, partnership, and LLC issues during divorce. Coordination with the family lawyer and the business appraiser is essential to keep the tax position aligned with the property settlement.

Joint Return Audits and IRS Collection After Divorce

An IRS audit of a joint return can land long after the divorce is final. Both spouses remain liable for any additional assessment unless innocent spouse relief is granted, and the IRS will pursue whichever spouse it can collect from. We represent former spouses in joint return audits, Appeals conferences, and Tax Court litigation, and we coordinate the audit defense with any pending innocent spouse claim.

When the IRS is actively collecting on a post-divorce joint liability, the collection toolkit applies — installment agreements, offers in compromise, and CDP appeals — and innocent spouse relief is often the most powerful remedy on the table.

Same-Sex Marriage, Prenups, and Estate Planning

Same-sex marriages have the same federal tax treatment as opposite-sex marriages, including the unlimited marital deduction, gift-splitting, and portability of the estate tax exemption. We advise same-sex couples on the same set of marital tax issues we handle for all clients. We also coordinate with family law and estate planning counsel on prenuptial and postnuptial agreements where tax provisions affect the agreement’s enforceability or its results.

Working With Our Houston Divorce Tax Attorneys

Clients come to us in three main situations. They are planning a divorce and want the tax issues addressed before the settlement is signed. They are after a divorce and have just received an IRS notice on a joint return. Or they are dealing with the long shadow of a spouse’s tax debt and need to know what is theirs and what is not. The first call is short, and we tell clients quickly whether the case is one we should take on. Our fee schedule and attorney bios are public.

Get Help With Your Marriage-Related Tax Problems

We are experienced tax attorneys in Houston, TX. We help clients with marriage-related tax planning and problems. This includes helping clients with innocent spouse claims.

Please call us at (713) 909-4906 or schedule an appointment with our divorce tax attorneys to discuss your situation.