Innocent Spouse Relief

Are you being bombarded with IRS envelopes in your mailbox about taxes owed that your spouse and you owe jointly and feel you knew nothing about them?  Are you afraid you will have to deplete bank accounts or personal assets to pay these mystery IRS taxes?  Take a deep breath and read on as there may be innocent until proven guilty!

If your spouse (or former spouse) improperly reported items or omitted items on your tax return, you can be relieved of responsibility for paying tax, interest, and penalties by requesting innocent spouse relief.

Normally, the tax, interest, and penalties that qualify for relief can only be collected from your spouse (or former spouse).  You are jointly and individually responsible for any tax, interest, and penalties if you do not qualify for relief. The IRS can collect these amounts from either you or your spouse (or former spouse). Innocent spouse relief only applies to individual income or self-employment taxes.

The IRS will determine if you are responsible for the tax after you file Form 8857.  If you wish, you can figure it out yourself, you can see How To Allocate the Understatement of Tax, within Publication 971 (PDF).

You must meet all of the following conditions to qualify for innocent spouse relief.

  • You filed a joint return that has an understatement of tax due to erroneous items, defined below, of your spouse (or former spouse).
  • You establish that at the time you signed the joint return you did not know and had no reason to know, that there was an understatement of tax. See Actual Knowledge or Reason to Know, defined below.
  • Taking into account all the facts and circumstances, it would be unfair to hold you liable for the understatement of tax. See Indications of Unfairness for Innocent Spouse Relief, below.

You and your spouse (or former spouse) have not transferred the property to one another as part of a fraudulent scheme. A fraudulent scheme includes a scheme to defraud the IRS or another third party, such as a creditor, ex-spouse, or business partner.

Contact us today if you feel you are a victim of fraudulent spousal schemes.  We have offices in Warren, MI, Sterling Heights, MI, and Richmond, MI.