When a joint tax return is filed, both spouses are generally held responsible for any tax due, even if one spouse earned all the income or made all the decisions related to deductions and credits. This joint responsibility can create problems if the IRS later finds an issue with the return and the tax debt was caused by one spouse alone. Our Baltimore County, MD tax lawyer knows that’s where innocent spouse relief and separation of liability come into play—two options that may help reduce or eliminate a spouse’s tax liability under certain circumstances.
We often assist clients who are dealing with the financial and legal consequences of a former spouse’s actions. Whether it’s unreported income, overstated deductions, or underpayment of tax, these issues and disputes can result in significant tax bills that one spouse feels unfairly burdened by. Innocent spouse relief and separation of liability are two potential ways to fix that, but both come with strict rules, deadlines, and qualifying factors. We offer 24/7 live call answering, so reach out to our team.
What Is Innocent Spouse Relief?
Innocent spouse relief is available to taxpayers who can show that they didn’t know, and had no reason to know, that their joint tax return understated the tax owed. The IRS will also consider whether it would be unfair to hold that person responsible. This often applies in situations involving financial control or dishonesty by one spouse. To qualify, we must file Form 8857 and make a case supported by facts, documentation, and in some cases, evidence of the relationship dynamics at the time the return was signed.
When Separation Of Liability Applies
Separation of liability is different. It allows someone who is divorced, legally separated, or no longer living with their former spouse to request that the IRS divide the tax debt between both spouses. That way, each person is only responsible for their share of the tax, rather than the full amount. This option is typically used when both spouses were aware of the contents of the return, but it’s still unfair to expect one person to cover the entire liability years after the relationship ended.
Key Factors And Time Limits
In both situations, the IRS will require details about your financial background, the return in question, and the nature of the relationship. If you’ve received IRS letters about a tax debt you believe isn’t yours, or you were surprised by a balance due based on your ex-spouse’s actions, it’s important to act quickly. There are deadlines that apply—generally two years from the date the IRS began collection efforts—so waiting too long could make these options unavailable.
How We Help
Working with a tax lawyer allows us to present a clear, well-supported case that addresses the IRS’s criteria directly and defend you. We help gather documentation, prepare forms, and correspond with the IRS on your behalf. If your claim is denied, we can request reconsideration or help appeal the decision. These situations can be stressful, but we’re here to help clients take the right steps and move forward with confidence.
If you believe you may qualify for innocent spouse relief or want to explore whether separation of liability applies to your situation, we invite you to contact Crepeau Mourges. We have over 40 years of experience and we’re ready to help you take the next step toward resolving your tax concerns.
