I have outstanding student loan debt. Due to personal reasons, I have not been able to make payments on this in a while. Last year, our refund was withheld and applied to my outstanding debts. If we file jointly this year again, but with her as the head of household, can our refund still be withheld? If so, should we then file separately so that only my refund is withheld and not hers as well?

ANSWER

The BIDaWIZ Team's Answer:

Please note that if you file as married filing jointly, then your wife would not be filing as head of household; that's not an option. If you are worried about your spouse's tax refund being withheld due to your outstanding tax debts, you should seriously considering filing as married filing separately. There are several tax benefits that you will lose by filing as married filing separately, but it usually is recommended to file as separately when one spouse has existing tax debts.