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separate property

Q&A: Future mate hasn’t filed tax returns. Am I liable?

May 4, 2025 By Liz Weston 1 Comment

Dear Liz: I’m engaged to someone who just confessed that they have not filed tax returns for the last several years. How do we fix this? If they owe a lot of money, could the IRS come after me if we’re married?

Answer: Technically, debts incurred before marriage are considered separate. But there are many ways premarital debt can affect postmarital life.

If you live in a community property state, for example, creditors could come after jointly owned assets if your spouse fails to pay what they owe. Your spouse’s debt could affect how much you two can borrow if you want to apply for a mortgage or other joint obligation. And the money your spouse uses to pay off the debt isn’t available for other uses that could benefit both of you. That could include everything from paying bills to going on vacation to saving for retirement.

The IRS is not a good creditor to have, in case you had any doubts. The agency has many enforcement powers, such as withholding refunds, taking part of someone’s paycheck and seizing property to pay debts. Consider working with a tax pro to get the missing returns filed as quickly as possible. The IRS also offers payment plans for those who can’t pay in full.

Filed Under: Q&A, Taxes Tagged With: community property, couples and debt, couples and money, IRS, separate property, Taxes

Q&A: Be careful when commingling old and new funds in a Roth IRA

February 24, 2025 By Liz Weston

Dear Liz: I am a stay-at-home mom of 15 years who has a Roth IRA account from working before marriage. I will start working again soon and would like to know how to best protect my separate property from my future community property earnings. Should I start a new Roth IRA instead of adding to my existing one so as to not commingle the funds?

Answer: That could be a smart idea.

In general, assets acquired before marriage are considered separate property. But that status can change if post-marriage funds are added into pre-marriage accounts. The rules vary by state, but making retirement contributions to a new account can help keep the lines between separate and marital property from getting blurred.

Filed Under: Couples & Money, Q&A, Retirement Savings Tagged With: community property, retirement accounts, separate property

Q&A: My ex-wife lent my money to her boss. What can I do?

June 10, 2024 By Liz Weston

Dear Liz: I recently found out that my ex lent one of her former bosses $2,500 to get his brother out of jail on bond. My ex took the money out of a joint account that I had opened with the inheritance I got when my dad died. It’s now been four years and I haven’t received a penny of the loan back. I could really use the money now as I have medical bills to pay. Question is who do I go after? My ex or the boss?

Answer: You may have read in this column that inheritances can be kept as separate property, even in community property states where other assets acquired during marriage are generally considered jointly owned.

An inheritance can lose its status as separate property, however, if it’s commingled with joint funds. That’s what you did when you opened a joint account with the money: You gave your ex access to the funds.

You certainly can ask the ex and the boss to give the money back. You could try small claims court if that doesn’t work. You also could hire an attorney, but the costs of trying to get the loan repaid may well exceed the amount at stake.

Filed Under: Couples & Money, Estate planning, Inheritance, Legal Matters, Q&A Tagged With: community property, Inheritance, joint accounts, marriage and money, separate property

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