The Internal Revenue Service recognizes that sometimes when filing a joint return, both parties may not be responsible for the resulting tax liability. However, when there is a tax liability, either party may be jointly and severally liable. The Internal Revenue Service provides 3 types of relief, Innocent Spouse Relief, Separation of Liability, and Equitable Relief. Innocent spouse relief is often thought to be the same as injured spouse relief. While there are similarities, injured spouse relief applies to actual or likely loss of overpayment (refund) due to one spouse’s delinquent student loans, child support, federal or state tax liability, or other issues causing a reimbursement compensation (reimbursement assigned to tax debt).
To be considered for injured spouse relief, the taxpayer must have made and reported tax payments, or claimed refundable tax credits. In addition, the taxpayer should not be legally responsible for the payment of any amounts due. If you filed a joint return and are not responsible for the debt but are entitled to a portion of the refund, you may request your portion by filing Form 8379, Injured Spouse Allowance.
To qualify for innocent spouse relief, the taxpayer must have filed a joint return, show that when the return was signed you did not know and had no reason to know that the understated tax occurred, have understated tax that is due to a inaccurate item (i.e., unreported income, inaccurate deduction, basis, or credit), and the facts reveal unfairness to hold the spouse liable. “Innocent spouse relief will not be granted if the IRS proves that you and your spouse (or former spouse) transferred property to each other as part of a fraudulent scheme” (irs.gov pub. 971). Separation of liability assigns the tax liability plus penalties and interest resulting from a joint return filed between each spouse. The allowance is based on the taxes, penalties, and interest that each spouse would normally be responsible for if the taxes were filed separately from their spouse.
Other requirements include that the taxpayer seeking relief has had a separate residence during the 12-month period ending on the date the relief application is filed, and is no longer married to or legally separated from the spouse with whom the application was filed. joint declaration. If he doesn’t qualify for innocent spouse relief or separation of liability, he may still be able to get relief. The IRS may grant equitable relief under the following conditions. You do not qualify for innocent spouse relief or separation of duties, you filed the right form at the right time, you filed a joint return for the year in question, no assets were fraudulently transferred to defraud the IRS, creditor, or company . partner, and your spouse did not transfer any assets to you for tax evasion purposes.
Remember, in all cases, the Internal Revenue Service will verify your tax compliance in the year(s) after the tax year(s) for your relief request.
