Are you being held liable for IRS back taxes as a result of filing a joint return with your spouse or former spouse? Unfortunately the law makes both of you fully responsible for the entire tax liability, even if the tax problem was caused solely by your spouse. The IRS recognizes that in certain circumstances it would be unfair to try to collect the taxes from you and has established guidelines for you to qualify for tax relief as an innocent spouse.
If you are granted innocent spouse status you will not be liable for part or all of the taxes owed by you and your spouse or former spouse for the year relief is granted. This means that the IRS will stop collection activities against you and you may be entitled to a refund for any taxes you may have paid toward the tax liability. You may qualify for one of three types of tax relief.
Innocent Spouse Relief
You will be relieved of paying any tax resulting from your spouse or former spouse omitting income, improperly deducting expenses, or claiming tax credits. You must meet the following conditions:
- You must have filed a joint return which has an understated tax that is due to erroneous items of your spouse or former spouse.
- At the time you signed the return, you did not know or have reason to know, that there was an understated tax.
- Considering all of the facts and circumstances, it would be unfair to hold you liable for the understated tax.
Separation of Liability Tax Relief
This type or relief allocates the understated tax on your joint tax return between you and your spouse or former spouse. To qualify you must meet one of the following conditions:
- You are either divorced or are legally separated from the spouse with whom you filed the return, or
- You did not live in the same household as the spouse with whom you filed the joint return at any time during the twelve months prior to filing the request.
Equitable Tax Relief
Equitable relief may apply if there is either an underpayment of the tax shown on the tax return or an understatement of the tax. The following conditions must be met for you to qualify for equitable relief:
- You don’t qualify for innocent spouse relief or separation of liability relief.
- You didn’t pay the tax (there are certain exceptions to this condition).
- You and your spouse or former spouse did not transfer assets to one another as part of a scheme to defraud the IRS.
- Your spouse or former spouse did not transfer assets to you for the purpose of avoiding the tax or the payment of tax.
- You did not file your return with the intent to commit fraud.
- After considering the facts and circumstances, it would be unjust to hold you accountable for the understated or underpaid tax.
- The income tax liability for which you seek relief is attributable to an item of your spouse or former spouse.
Don’t let the IRS force you to pay taxes related to your spouse or former spouse’s misdeeds. Let the tax experts at East Coast Tax Consulting Group review your circumstances to determine whether the innocent spouse program is your answer to tax relief.
Call us today for Innocent Spouse Relief!
With over 30 years of experience, our tax professionals are here to help you obtain relief from your tax problems. Let our team of CPAs help settle your tax debt for the lowest amount permitted and solve IRS problems such as bank levy, IRS audits, wage garnishments, unfiled tax returns, IRS liens and payroll tax penalties. Proudly serving Boca Raton, Florida and elsewhere throughout the U.S. Call for your Free Consultation today!