smart spending

Signs your spouse may be ripping you off

Tax cheats cause collateral damage
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The sneak: Aaron was in partnership with some high rollers who made him feel like a big shot. When he learned that he owed the Internal Revenue Service $24,000 in back taxes, his buddies told him not to worry, their accountants were on it. When Hayden advised him to pay up rather than risk accumulating more back taxes, Aaron got angry and ignored her. Ten years later, he owed $320,000. Aaron and his wife had to repay it to keep him out of prison.

The reason: Ego can trump judgment for some individuals, especially entrepreneurs. "They're willing to take enormous risks, and one of the risks they'll take is with the IRS," says Hayden. "Everybody was making decisions out of ego, including their lawyer and accountants."

The fix: Communication. "Two rules make this work," Hayden says. "One, what money is yours, what money is mine, what money is going to retirement, and does it all add up? And two, does it feel fair to both of us? She paid for half of his mistake because they both signed the tax return. She wanted him to pay it; she just thought he was being dumb."


 

 

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