I had some IRS penalties from a prior business. When my wife and I filed our tax return, the IRS took away our refund and applied towards that outstanding amount. Can the IRS take away my wife's refund? She did not have anything to do with outstanding amount.
2 Answers from Attorneys
Probably, but since no one here has your returns or know the other facts, such as who had the withholding, it is impossible to tell you the answer. Qualified advice before the returns were filed may have avoided this problem (through the filing of separate returns).
If you filed jointly, yes they can. The solution is to file separately, but this often increases the taxes for the current year. You should calculate your taxes both ways, to see which way leaves the two of you better off.