Over my years as a tax professional, I’ve found that determining eligibility for innocent spouse relief usually requires discussing your personal and tax circumstances with a tax professional. This can be very difficult because of the way personal and tax issues are intertwined in your case. For this reason, it is important that you work with a tax professional with whom you are comfortable discussing both your private and financial life.
What is Innocent Spouse Relief? The purpose of innocent spouse relief is to request that the IRS remove your liability for additional taxes, penalties, and interest owed on income your spouse did not report on your joint tax return, taxes not paid to the IRS because of your spouse’s business, or other activities that resulted in additional tax about which you were not aware.
Innocent Spouse Relief is comprised of three different types of relief: General Relief, Separation of Liability Relief, and Equitable Relief. Your tax professional will discuss which type of relief is recommended for your situation once a review of the facts and circumstances of your case is completed.
The following is additional information you need to understand when requesting innocent spouse relief:
- You will be responsible for the tax assessed on the tax return that is not part of the innocent spouse relief you are seeking. Innocent spouse relief does not remove all the tax liability, just the portion of tax liability that you are requesting relief for – so after receiving relief as an innocent spouse, you still may have taxes to be paid.
- Your tax professional will be asking you for information that will include your story of events and the documents and records that will help to support your request. The tax professional may ask questions regarding your personal life, including behaviors, events, criminal activities, and substantiation of these events in written statements and third-party records, such as separation/divorce decrees, police reports, statements from social workers, and other third parties that may assist in your case.
- Once your tax professional has interviewed you and reviewed the documents you provide, they will evaluate your chances of succeeding with your request. If the tax professional does not believe you will be successful, they may present you with other types of requests that can be made on your behalf to resolve your tax problem.
- The IRS will notify your spouse (or ex-spouse) that you are requesting relief from payment of the additional tax, penalties, and interest. The agency will also request a response, but they will not reveal your name, address, or other personal information to your spouse or ex-spouse.
How long will it take for the IRS to review my case and respond to let me know if I have been given relief for the additional taxes? It can take the IRS six months or more to process and decide on your case, plus the time it takes for the tax professional to prepare the case.
What happens if the IRS does not accept my request for innocent spouse relief? If your request is denied, your tax professional will discuss your options based on the facts and circumstances of your case.
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