Innocent Spouses And The IRS
Below is a MRR and PLR article in category Finance -> subcategory Taxes.
Innocent Spouses and the IRS: Understanding Your Tax Relief Options
Introduction
In the past, tax issues from troubled marriages were simply considered part of the marital package. If one spouse provided false information on a joint tax return, the IRS held both accountable. However, the IRS has shifted its stance, now offering innocent spouse tax relief.
Financial Strain in Marriages
Financial disputes often exacerbate marital problems, especially with joint tax filings. Historically, inaccuracies in such filings led to both spouses facing the consequences, including potential criminal charges for tax evasion.
New Relief Options
Thankfully, the IRS now acknowledges the plight of innocent spouses and offers three main types of relief:
1. Innocent Spouse Relief
2. Relief by Separation of Liability
3. Equitable Relief
Qualifying for Relief
To qualify for any of these reliefs, you must meet the following criteria:
1. You filed a joint return with incorrect information.
2. You were unaware of these inaccuracies.
3. Holding you accountable would be unfair given the circumstances.
The IRS will assess your case and may choose to pursue the tax debt solely from your former spouse. Alternatively, they might split the debt between you, reducing your obligation by half.
Equitable Relief
In rare scenarios, you can seek equitable relief by demonstrating:
- No asset transfers occurred as part of a fraudulent scheme.
- There was no intent to evade taxes or commit fraud.
- You had no knowledge of your spouse’s actions.
Such claims should be made cautiously, as the IRS scrutinizes them closely. Yet, they remain a crucial option when other avenues have been exhausted.
By understanding these options, innocent spouses can better navigate the complexities of tax liabilities arising from a troubled marriage.
You can find the original non-AI version of this article here: Innocent Spouses And The IRS.
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