| Couples who file their tax returns as "married filing | | | | spouse did not know or have reason to know on |
| jointly" become jointly and severally liable for the | | | | signing the return of the understatement of tax;d. given |
| amount of tax liability shown on the federal tax return. | | | | the facts and circumstances, it is inequitable to hold the |
| "Joint and several" liability means that each spouse is | | | | innocent spouse liable for the tax deficiency; ande. the |
| liable for up to the full amount of taxes due, regardless | | | | innocent spouse elects to apply for relief no later than |
| of who (i.e., which spouse) actually earned the income. | | | | two years from the date of the IRS's first collection |
| However, the IRS recognizes that in certain | | | | activity against the innocent spouse. |
| circumstances, one spouse is innocent for the | | | | Method 2. The second type of innocent spouse relief |
| erroneous information provided on a tax return or for | | | | exists for individuals who filed a joint return and either |
| the failure of the other spouse to pay the tax. Thus, | | | | (a) are divorced, or are legally separated from, the |
| the IRS has allowed spouses to claim "innocent | | | | individual who filed the joint return or (b) are not |
| spouse relief." If granted, innocent spouse relief | | | | members of the same household during the 12-month |
| essentially frees the "innocent" spouse from the "guilty" | | | | period ending on the date of the election for relief. For |
| spouse's wrong-doings and ultimately the tax liability of | | | | individuals who are divorced, legally separated, or not |
| the guilty spouse, which may be the entire amount of | | | | living together, they can be granted relief of the |
| taxes owed or a portion of the taxes owed depending | | | | deficiency unless (1) the "innocent" spouse claiming |
| on the circumstances. | | | | relief had actual knowledge on signing the return of the |
| Innocent spouse relief can be obtained in one of three | | | | understatement of tax or (2) assets were transferred |
| ways, but before getting into the details, ask yourself | | | | to the innocent spouse with a tax avoidance purpose |
| what kind of relief you are seeking. If you filed your | | | | (if either of those cases applies to you, we'd say that |
| return incorrectly (either because you omitted income | | | | you probably weren't so innocent after all). |
| or included deductions or credits that you shouldn't | | | | Method 3. The third type of relief is available if (1) |
| have), then you can use any of methods 1, 2 or 3. If | | | | neither of the methods described above is available to |
| you filed your return correctly but failed to pay the | | | | the innocent spouse and (2) it would be inequitable to |
| amounts due, then you can use only the method 3. | | | | hold the spouse liable for the unpaid tax shown on a |
| Method 1. Under the first type of innocent spouse relief, | | | | return or for a deficiency. The IRS ordinarily will grant |
| the innocent spouse may be relieved of an | | | | relief where (1) the spouse no longer is married to, is |
| understatement of tax. You have an understatement if | | | | legally separated from or for the prior 12 months has |
| the IRS says you owe MORE than what is shown to | | | | been living apart from the guilty spouse that signed the |
| be due on your tax return. The amount of the | | | | joint income tax return; (2) the innocent spouse did not |
| understatement is the difference between what the | | | | know and had no reason to know the tax would not |
| IRS claims that you owe and what is shown to be due | | | | be paid and had reason to believe that the guilty |
| on your return. You can get relief under Method 1 if all | | | | spouse would pay that liability; and (3) the spouse could |
| the following conditions are met:a. a joint return is filed;b. | | | | suffer undue hardship if relief is not granted. The third |
| an understatement of tax exists that is attributable to | | | | method is the only method available to innocent |
| erroneous items of the "guilty" spouse (typical | | | | spouses to request relief from paying taxes actually |
| erroneous items include omissions of income, | | | | shown due on the tax return. Like the other two |
| understatements of income, overstatements of | | | | methods, it can also be used to get relief from paying |
| deductions, misstatements of basis in property, over | | | | taxes on top of and in addition to the taxes shown |
| claims of exemptions and credits, and arithmetical | | | | due on a tax return. |
| additions, subtractions, and transfers);c. the innocent | | | | |