What Actually Is Innocent Spouse Relief?

Innocent spouse relief is when the IRS grants relief status to spouses found to be not liable for a married couple’s joint tax liability. It’s granted when a spouse did not know or did not have any reason to know of any unreported income from the other spouse on the joint tax return.

What Are Common Scenarios Where This Might Occur?

Innocent spouse relief may be granted by the IRS when a business owner’s spouse is not privy to his or her financial dealings and the income is not reported on the tax return. If the other spouse does not knowingly benefit from the unreported income, then that spouse may be granted relief under Internal Revenue Code Section 6015.

Are There Different Types Of Innocent Spouse Relief?

There are three types of relief available under Internal Revenue Code Section 6015. The first applies to situations in which a spouse was unaware of any unreported income on the tax return. The second type of relief applies to situations in which a spouse had not been married for at least 12 months and had been living alone at the time of filing the election. The third type of relief applies to situations in which a court or the IRS finds it inequitable to hold a spouse liable for the joint tax liability.

How Do I Qualify For Innocent Spouse Tax Relief?

An individual can qualify for innocent spouse tax relief by submitting a formal application to the IRS, which includes IRS form 8857. The individual will be required to describe in detail why they qualify for one of the three provisions under the Internal Revenue Code.

When Can A Tax Payer Qualify For Innocent Spouse Relief?

In order to qualify for innocent spouse relief, a joint return would have to be filed. A taxpayer may qualify if they did not know, or had no reason to know of unreported income on the return.

What Actions Can The IRS Take If I Don’t Seek Innocent Spouse Relief?

If innocent spouse relief is not applied for, then the IRS may hold a spouse responsible for any tax liability when an audit occurs. This is true even if the taxpayer did not know about the income received by their spouse.

How Do I Apply? What Forms Do I Need To File For Innocent Spouse Relief?

In order to apply for innocent spouse relief, an individual must submit IRS form 8857, in which they would need to describe how they qualify under the Internal Revenue Code.

Can I Qualify For Innocent Spouse Relief If I Qualified For An Offer In Compromise As Well?

Once an offer in compromise has been accepted and there is an agreement with the IRS to pay a certain amount of the debt, that agreement cannot cancelled by filing an innocent spouse relief request.

For more information on Innocent Spouse Relief In California, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (714) 321-3369 today.

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