The U.S. District Court for the Western District of Louisiana held that a taxpayer could use the married filing jointly status on delinquent tax returns for the five tax years preceding the year his spouse had died. The government unsuccessfully argued that joint status was available only for the year of his spouse’s death.
Generally, a husband and wife may elect to file a joint tax return if they have the same tax year and both are U.S citizens or residents. If one spouse dies, section 6013(a)(3) allows the surviving spouse to file a joint return with the deceased spouse if no return has been filed for the taxable year by the deceased spouse, no executor has been appointed, and no executor is appointed before the last day a return can be filed by the surviving spouse. Treas. Reg. § 1.6013-1(d)(3) provides an example where a surviving spouse could file a joint return for 1956 and 1957 as long as the death of the other spouse in 1957 occurred before the due date of the 1956 return, assuming the other conditions of section 6013(a)(3) were met.
Donald Vidalier and his wife did not file income tax returns for the years 2000 through 2005. Vidalier’s wife died on Dec. 12, 2005, and after filing a Chapter 13 bankruptcy petition in 2006, Vidalier filed delinquent joint returns for all years. The IRS permitted the joint status for 2005 but not for the other years and adjusted his bankruptcy liabilities based on the married filing separately status. Vidalier objected, but the bankruptcy court agreed with the IRS, so he appealed the decision.
The government argued that when Congress used the phrases “the joint return” and “the taxable year” (emphasis added) in section 6013(a)(3), it intended to limit the ability of a surviving spouse to file a joint return to only the year of the other spouse’s death, and the joint status is not permitted on delinquent returns for previous years. It also argued that the application of Treas. Reg. § 1.6013-1(d)(3) would allow Vidalier to file a joint return only for 2005, since his wife died after the due date for the 2004 return. The district court rejected these interpretations, citing Friedman v. Commissioner (TC Memo 1987-6), in which the Tax Court permitted joint status on returns for 1977 and 1978 filed in 1981, even though the taxpayer’s spouse had died in 1978. It stated the section 6013(a)(3) requirements are applied to each year in question and are not limited to only one year. Since Vidalier met all of the requirements of section 6013(a)(3) for each year, the court stated the joint status was permissible.
n Donald James Vidalier v. U.S., 102 AFTR2d 2008-6076
By Charles J. Reichert, CPA, professor of accounting, University of Wisconsin–Superior