Spouses who are being held liable for their partner’s mistakes and shortcomings in filing taxes may be eligible for innocent spouse relief. The IRS normally goes after both individuals in a marriage if they filed jointly on their tax return. By signing the return, they both take responsibility for what is included in it and any tax amounts owed. As a legal and binding document, the IRS contends that both parties must carefully review and approve each form before signing it and assuming responsibility.
In the past few years, the IRS has determined that there are several situations beyond an individual’s control where they may not be financially liable for their actions of their spouse. At one time, a person who believed they were being held responsible for a tax liability incurred by their spouse, only had two years to file for relief. In 2011, the IRS extended the amount of time a spouse had to file for relief to ten years.
The IRS has up to ten years to pursue someone who has failed to file their taxes or pay taxes that are owed. An innocent spouse was held to a disadvantage by the prior regulations that limited their time to file for relief. With the extension, they now had the same amount of time as the IRS to prove their case.
An innocent spouse is not the same as an “injured” spouse. An injured spouse is one who has their return taken to satisfy a past debt, such as property lien or back child support. An innocent spouse is one who is held liable for the misappropriations of their partner. Unbeknownst to them, the other partner either failed to claim the right amount of deductions or did not pay the proper amount of taxes owed to the IRS.
While the IRS holds to their belief that a person’s signature holds them responsible, they are also aware that mitigating circumstances can cause a partner to follow the wishes of the spouse or not question their actions due to fear or the threat of being harmed. In situations like this, a thorough investigation will help to determine where the true liability lies and will pursue the party accordingly.
If a person believes they are eligible or may qualify for Innocent Spouse Relief, they must file all of the appropriate paperwork as soon as possible. This will ensure they have enough time to protect themselves and their assets from being taken by the IRS. Before they file for the protection afforded by the Innocent Spouse Relief program, the person who is being unjustly pursued must be able to provide documentation to support their claim.
The IRS will do everything possible to disprove the claim but with adequate and reputable representation by a qualified tax attorney, the innocent spouse can receive relief. A qualified attorney can provide a substantial list of documents a person can use to prove their innocence. They can also inform the innocent spouse of their rights and what they need to do to protect themselves against any further action taken by the IRS or other collection agencies.