Innocent Spouse Relief: When Your Spouse Is Responsible For Tax Errors

When you find yourself faced with an IRS audit or subject to IRS collection efforts due solely to your spouse’s errors in claiming income or calculating tax owed, you have options. At the Law Offices of Robert T. Leonard, APC, we provide you with a candid assessment about your situation and take the time to discuss innocent spouse relief and other options that can keep you from being penalized for your spouse’s errors.

When Is Innocent Spouse Relief Available? What Must You Prove?

Innocent spouse relief is available to taxpayers in situations where a current or former spouse filed a joint tax return, which:

• Did not report income
• Reported an incorrect amount of income
• Claimed deductions improperly
• Requested tax credits when none should have been granted

In these situations, you will need to prove to the IRS that:

• The deficiency on the joint tax return is the result of your spouse’s error (also referred to as an erroneous item).
• You did not know of the joint tax return error (or erroneous item) that led to an understatement of tax.
• You had no reason to know of the error/erroneous item.
• You were separated or divorced, or had not lived in the same household as your spouse for at least 12 months when the joint return was made.
• The totality of the circumstances makes it unfair for you to be held liable for your spouse’s error.

You need an attorney who has experience in tax controversies to ensure that you submit as complete a request for innocent spouse relief as possible. With our extensive understanding of how the IRS analyzes innocent spouse applications, we can greatly increase your chances of having your request for relief granted.

The Timing Of Your Request Is Important

A request for innocent spouse relief is time sensitive; you must request this relief within two years of the date when the IRS first sought to collect additional tax from you and your spouse. Past this date, the only way to obtain innocent spouse relief is through an appeal to the United States Tax Court.

Innocent Spouse Relief: The Basic Answers

Innocent spouse relief offers valuable protection to individuals who find themselves in difficult situations due to their spouse’s actions. It can be a complicated process, and it can feel very overwhelming to cope with an intimidating tax problem. No doubt, you have plenty of questions about it. Below, we answer some frequently asked questions about innocent spouse relief, including who qualifies, how to apply and what happens if your request is denied.

What is innocent spouse relief and who is eligible for it?

If your spouse committed tax fraud or made tax errors, innocent spouse relief can excuse you from paying joint tax liabilities. To qualify, you must meet certain conditions, including:

• Filing a joint tax return
• Having an understatement of tax because of your spouse’s actions
• Showing that you were not aware of the fraud or errors
• You did not benefit from the fraud or errors

You must also demonstrate that it would not be fair to make you pay the tax debt. If you meet these conditions, you may be eligible for innocent spouse relief.

How do I apply for innocent spouse relief?

To apply for innocent spouse relief, you will need to: 

1. File Form 8857, Request for Innocent Spouse Relief, with the IRS. You can file this form electronically or by mail.
2. Attach supporting documentation to your application, such as a copy of your joint tax return and any relevant evidence that supports your claim. 

You can also request relief by submitting a written statement to the IRS, but using Form 8857 is the recommended method. Another important step is to consult a tax attorney to learn about your options and rights.

What are the potential outcomes if my innocent spouse relief request is denied?

If your innocent spouse relief request is denied, you may still have options to appeal the decision or seek alternative relief. You can appeal the denial to the IRS Office of Appeals, where an independent reviewer will reexamine your case. 

You may be eligible for other types of tax relief, such as: 

• Separation of liability
• Equitable relief 

In some cases, you may need to pay the tax debt. However, you can often work with the IRS to set up a payment plan or negotiate a settlement. The best way to position yourself to receive innocent spouse relief is to work with a tax lawyer who can advocate for you, communicate with the IRS and protect your rights.

Get A Free Consultation With A Tax Lawyer

Get a free, confidential assessment of your tax situation by contacting our firm at 818-485-2115. You may also contact us online. During your consultation, you will speak directly with attorney Robert T. Leonard. We represent clients in innocent spouse matters throughout California — including Westlake Village, Los Angeles and the San Fernando Valley — and across the nation.