Levins Tax Law
Schedule your initial consultation:

Experienced and Trusted
Representation From A Tax
Attorney And Former IRS Agent
And "BIG 4" Tax Partner

Photo of Attorney Gerard J. Levins

What is tax relief as an innocent spouse?

People whose spouses fail to report taxable income may be able to avoid personal liability under the Internal Revenue Service’s Innocent Spouse Relief.

It is common for married couples in Massachusetts to file their tax returns jointly using the Internal Revenue Service designation known as “married filing jointly”. By using this option, both spouses acknowledge their liability for any tax debt owed related to information on that return.

However, issues may arise when it later comes to light that one party in the marriage failed to report some income or made other errors on the return. Technically, both spouses would still be liable for any debt. This would mean that the IRS could pursue one or both parties for any outstanding amount. There are some situations in which one person may be able to avoid this liability if they meet certain criteria under the Innocent Spouse Relief program.

Understanding Innocent Spouse Relief

Simply put, the IRS identifies an innocent spouse as someone who legitimately did not know about a particular tax return error. This determination may then make that spouse not liable for any tax debt associated with that error.

Forbes explains that when a couple is getting divorced, spouses should carefully assess the potential that their partners are hiding assets . If this is suspected, filing a final tax return as “married filing separate” may well help them to avoid future unexpected liability. When this option is not used and a surprise potential tax debt comes to life later, the Innocent Spouse Relief option may provide help.

Criteria for Innocent Spouse Relief

There are three basic items that must be proven or true in order for a person to be eligible to be identified as an innocent spouse by the Internal Revenue Service. One of these is proof that they did not or could not really have known about the error at the time that the tax return was filed. Part of this proof includes showing that they had no reason to know about the error.

Another element involves proving that the error is about items relating only to one spouse such as income in that person’s name only. Finally, the spouse seeking relief will need to prove that pursuing collection from them would be unfair once all facts are considered.

The IRS does review things like the potential innocent spouse’s background for both business knowledge and education and the couple’s financial situation at the time of the filing and at the time of the dispute. The type and value of the error may also factor into a final determination.

Seeking help from tax collections

Massachusetts residents who believe they are being pursued for tax debt they should not be liable for should always contact an attorney. Working with a professional who understands what the IRS needs to know in order to grant Innocent Spouse Relief may give people the help they need to avoid paying debts that are not ultimately theirs.