What happens if your spouse cheats the IRS on his or her taxes

When both partners in a marriage have high-paying jobs, or even his or her own separate businesses, monetary secrets can sometimes occur. Such secrets can become dangerous if one spouse gets caught not reporting all his or her income in Texas. The Internal Revenue Service (IRS) can hold the innocent spouse liable in such cases. Fortunately, a tax relief method called innocent spouse relief may get you off the hook.

Innocent spouse relief

IRS tax law recognizes three kinds of innocent spouse relief, which can allow the spouse who is not responsible for the underreporting of income on a joint tax return to not be held liable for the extra tax and penalty. The three categories of innocent spouse relief are equitable relief, relief by separation of liability and innocent spouse relief. The type of relief that applies to you depends on your specific situation.

To be eligible for innocent spouse relief:

  • You must have been married, or were, and filed a joint tax return.
  • Your current or former spouse incorrectly reported income on one or more returns.
  • There is evidence that you didn’t know the income was reported incorrectly.
  • Holding you liable for those taxes would be unfair.

Applying for innocent spousal relief

Like anything else involving IRS tax law, applying for innocent spouse relief requires you to fill out specific forms and follow the IRS’s process. You will have two years from the time that the IRS noticed that income was underreported and sent a notice about it. The process for applying involves a variety of questions that you need to answer that can be confusing.

If you are in a questionable tax situation involving your current or former spouse, contact an experienced tax attorney. By doing so, you can apply for one of the forms of relief.