Tax problems from a joint return may continue to follow you after a divorce or separation. Under the doctrine of joint and separation liability, the IRS may go after either spouse individually for the full amount of tax debt from a joint return, even if your spouse or former spouse is responsible for the items causing the tax debt.
If you don’t do anything, the IRS can keep coming after you for the joint tax debt and may attempt to seize your assets or wages. You can request innocent spouse relief to avoid liability for some or all of the tax debt if you are eligible.
Types of Innocent Spouse Relief
Separation of liability relief is specifically made for divorced or separated taxpayers, but you may qualify for one of the two other types of relief as well. Traditional innocent spouse relief may be available if you didn’t know about an erroneous item on your return that caused your tax problems, and equitable relief is a catch-all provision used when it would be unfair to hold you responsible for the tax liability.
Consult a tax attorney to see if you are eligible for one or more types of innocent spouse relief. If you receive an IRS notice, take action because you may have a limited time to request innocent spouse relief.
Separation of Liability Relief
You may qualify for separation of liability relief if you meet the following conditions:
- You’re divorced or separated from the spouse you filed the joint return with.
- You’re widowed.
- You haven’t been a member of the same household as your spouse for at least 12 consecutive months.
Additionally, you may not have had actual knowledge of the item on the return that caused the understatement of tax. For example, if you knew your spouse was overstating their home office deduction expenses, you wouldn’t be eligible for this type of relief.
If you do qualify, the tax will be allocated between you and your former spouse. So instead of being joint and severally liable for the whole amount, you will be solely responsible for your portion of the tax liability.
Have a tax resolution attorney evaluate your case to see if you are eligible for an IRS installment agreement or Offer in Compromise. Call The Gartzman Law Firm at (770) 939-7710 to set up a case evaluation.