Ronald Arthur Stearns Sr. PLLC
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What is innocent spouse relief?

When a married Texas resident files a joint tax return, it means they are both jointly and severally responsible for the ensuing liability. So, not only is it possible to collect the tax liability from the couple, the Internal Revenue Service can also collect it from any one spouse. This is true even if the couple divorces. For example, if one's former spouse did not report their income, then either of the spouses can be liable, unless one can qualify for innocent spouse relief.

If an individual qualifies for it, they can be relieved of their responsibility to pay not only the tax but also the interest and penalties resulting from it. Certain conditions must be met to qualify, such as the filing of a joint return with tax understated due to erroneous items and establishing that the innocent spouse did not know or have reason to know about the understatement of the tax. Erroneous items could be both unreported income and incorrect deductions. For example, the expense being deducted was never incurred or paid or it does not qualify as a deductible expense.

Additionally, the innocent spouse should not have known about the erroneous item. If they did know, then they do not qualify under IRS tax law. The IRS looks at all the facts of the situation to determine if someone should have known about the erroneous items, including the couple's financial situation, educational background, the nature of the erroneous item and the amount of the item in relation to other items.

Tax burdens are heavy enough without someone trying to underreport one's income or incorrectly claim expenses. When a spouse or former spouse's behavior results in a big tax bill, there are collection alternatives available to innocent spouses. An experienced attorney can provide useful information.

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