Widow Found Personally Liable for Deceased Husband’s Tax Liability

A widow was held personally liable for her deceased husband’s tax liability.

A federal tax lien was imposed on property owned by the husband, and the property was purchased by a friend of the husband from the husband’s bankruptcy estate. The friend rented the property to the couple and later sold it to another friend of the husband. The couple continued to pay rent to the second friend for an amount that covered the mortgage, taxes, insurance, and utilities.

After the husband died, the wife purchased the property for an amount equal to the mortgage, down payment, and capital gain taxes but less than the fair market value of the property. The district court held that the husband retained possession and control of the property after the first transfer.

See Wife Had Transferee Liability; Government Properly Entitled to Judgment (Patras, CA-3), CCHGroup.com, Nov. 22, 2013.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.