What Is Innocent Spouse Tax Relief?

Website Provided by HG.org

Relief from taxation through filing with or without a spouse occurs when one person in the relationship needs protections against the actions of the other in the marriage. Any misfiling or incorrect details in income may cause serious consequences for both parties when married, and sometimes it is only the fault of one that needs addressing.

Joint tax filing for a married or divorced couple usually leads to responsibility for both when the details are incorrect. Severe and drastic punishments may occur when the Internal Revenue Service becomes aware that information placed in paperwork is not accurate. In standard circumstances, both the husband and wife are held accountable for filing in this manner. However, there is possible relief for the innocent party. If the spouse is not aware that the other was attempting to deceive the IRS and federal or state government of taxes through false representations, this branch of the government may have protections for the innocent party.

Possible Relief Available

Innocent Spouse Relief is available for one part of a couple when the other has incurred penalties for tax purposes. This usually leads to severe fines and other payments to the IRS after filing inaccurate information. Failing to report income, a lack of taxed amounts provided for revenue or claiming improper deductions usually ends in this situation where additional amounts need payment. By separating the liability in these circumstances, the innocent spouse may ensure relief from additional payments to the IRS. When the spouses are legally separated or not filing jointly, this is possible. Then, the wife or husband is only responsible for the tax allocated to him or her.

If the innocent spouse tax relief is not possible or available, the person may seek equitable relief. This is possible if the tax return information is correct but the taxes that need payment did not receive the money needed. This is possible for joint filing with a married couple or a single spouse that is either separate or no longer in the marriage. It is important to understand which is available or possible based on the circumstances. Without seeking some relief in these situations, the spouse could face serious fines in addition to the amount that needs payment. This is more complicated if the other spouse refuses to pay or cannot assist in these matters.

Time Limits

The scope of relief available does have a time limitation. The spouse that seeks innocent spouse relief or a separation of liability in these matters must do so before a two-year period passes from the first attempt to collect payment by the IRS. Equitable relief requests must occur during this collection period. Any attempts after these times will usually invalidate any possible relief available to the spouse. In trying to separate from liability, the individual may seal his or her fate in repaying the amounts. This is even necessary when the person is not responsible for the circumstances.

The Circumstances Explained

The possible relief against tax repayment may determine what could occur based on the circumstances of the individual spouse. If the husband or wife is innocent of any inaccuracies, and the IRS is aware of this, the innocent spouse relief option could arrive in documentation for that person after he or she explains the information. However, if the spouse does not take initiative and seek out a possible resolution, the optionís time limit may pass. Then, repayment may become the only available outcome for these situations. Innocent spouse tax relief is necessary when only one spouse is engaging in dishonest or deceitful activity with income tax.

Joint filing may cause a tighter responsibility for both parties in the taxation circumstances. However, if the spouse contacts the
IRS after the collection for payment occurs, he or she may become aware of the entirety of the incident. Understanding that the tax returns contained incorrect, inaccurate or fraudulent details may provide answers and an outlet to seek a positive outcome. The person must take part in a joint tax return with understatement of tax due to the other spouseís items, have no knowledge even after singing the return and explain the matter to the IRS.

Legal Help in Innocent Spouse Tax Relief

When severe penalties may apply for a tax return with inaccurate details, it is usually important to hire a tax lawyer. He or she may communicate this matter to the appropriate authorities and provide a resolution that best matches the circumstances to positively conclude the matter.

Copyright HG.org

Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.

Find a Lawyer

Find a Local Lawyer