Most married couples joint file their tax returns. However, this can be regrettable when the IRS audits a joint tax return during or after a divorce. Innocent spouse relief can be obtained at the time of your divorce or years later.
When you sign a tax return you become liable for any taxes due, plus interest and penalties. This means the IRS could still come after you if your former spouse was responsible for errors in your joint tax return.
When you sign a tax return you become liable for any taxes due, plus interest and penalties.
Under tax law, there are three opportunities to obtain innocent spouse relief:
1. Expanded Innocent Spouse Relief Qualifications
- You and your spouse must have filed a joint tax return.
- The other spouse listed an erroneous item, resulting in an understatement of tax due.
- Holding the taxpayer liable is not equitable.
2. Separate Liability Election Qualification
To qualify for this option, you need to be divorced, living apart, or legally separated from your spouse for at least 12 months. This election allows you to limit your responsibility and could possibly prove that you are only liable for part of the joint tax filing. This is based on how items would have been allocated on separate tax returns.
3. Equitable Relief Qualification
This tax relief measure helps those who don’t qualify for Expanded Innocent Spouse Relief or Separate Liability Election. You may qualify if you were unaware that tax was due or a payment wasn’t made.
Contact your tax advisor or the attorneys at Bohm Wildish to learn more about innocent spouse relief, and whether you are a victim of joint return deficiency.