Editor’s Note: This post was originally published in May 2012 and has been updated for accuracy and comprehensiveness.

So, you and your spouse filed a joint tax return, but later you discover there are some major errors or even outright omissions that lead to a hefty tax bill. And here's the kicker: you had no clue about these mistakes when you signed the return. You might want to consider filing for innocent spouse relief.

Innocent spouse relief is a provision from the IRS that can help you avoid being held responsible for the extra taxes, interest, and penalties stemming from your spouse's (or ex-spouse's) errors. It’s designed to protect you if you were genuinely unaware of the issues on your joint return. Whether you’re still married, legally separated, or divorced, this provision can help ensure that tax responsibilities are divided fairly.

There are a few types of relief available, depending on your situation, and it can get a bit complex. But the basic idea is to make sure you're not unfairly stuck with tax problems that you didn’t cause or know about. If you find yourself in this kind of tough spot, understanding innocent spouse relief can be a real game-changer in managing your financial obligations.

Types of Innocent Spouse Relief

1. Innocent Spouse Relief: This applies when a joint tax return has an understatement of tax due to erroneous items of one spouse, and the other spouse did not know or have reason to know about the error.

2. Relief by Separation of Liability: This allocates the additional tax owed between the spouses (or former spouses). This type of relief can be requested if the individuals are no longer married, legally separated, or have not been living together for the 12 months ending on the date the election is filed.

3. Equitable Relief: This applies when the other two types of relief are not available, but it would be unfair to hold the requesting spouse liable for the unpaid tax or understatement of tax. This can include situations where there is an unpaid tax balance but not an understatement of tax.

Qualifications for Innocent Spouse Relief

To qualify for innocent spouse relief, the requesting spouse must meet several criteria:

• A joint return was filed with an understatement of tax due to erroneous items of the other spouse.
• The requesting spouse can prove that at the time they signed the joint return, they did not know and had no reason to know that there was an understatement of tax. (The IRS offers some exceptions to this in cases of domestic abuse.)
• Considering all the facts and circumstances, it would be unfair to hold the requesting spouse liable for the understatement of tax.

Application Process

To apply for innocent spouse relief, the requesting spouse must file Form 8857, "Request for Innocent Spouse Relief." The IRS will review the request and consider all facts and circumstances before making a determination.

Qualifying for Innocent Spouse Relief

The most difficult part of getting innocent spouse relief is proving that you qualify to claim it. The key requirements include proving that you did not have joint bank accounts with your spouse, proving that you did not benefit from the lifestyle provided by the tax fraud and that you had no involvement whatsoever in your spouse's business. In short, you have to prove that you had no knowledge or opportunity to know about your spouse's tax misdoings. However, if you are a victim of domestic abuse, the IRS will give special consideration to your circumstances, even if you knew about the inaccuracies on the tax returns.

You should note that the timing of your request for innocent spouse relief is very important. The request for innocent spouse relief must generally be filed within two years after the IRS first attempts to collect the tax. And you will need to be prepared to provide supporting documentation, such as financial records, communication evidence, and any proof of abuse or control by the other spouse. This documentation can be crucial in showing your lack of knowledge or complicity in anything inappropriate in your tax returns.

 

Due to the complexity of tax laws and the specifics of each case, consulting with a tax professional or attorney may be beneficial.

 

Innocent spouse relief is an important protection for individuals who find themselves unfairly burdened with tax liabilities due to their spouse's actions. If you think you're eligible for IRS innocent spouse relief, why not find out more about the provision and ask a tax resolution professional about qualifying? This program can help you resolve back taxes on a debt you were not responsible for creating.