Many married taxpayers choose to file a joint tax return because of certain benefits this filing status allows. Both taxpayers are jointly and individually responsible for the tax and any interest or penalty due on the joint return even if they later divorce. This is true even if a divorce decree states that a former spouse will be responsible for any amounts due on previously filed joint returns. One spouse may be held responsible for all the tax due even if all the income was earned by the other spouse. This is true even if a divorce decree states that your spouse will be responsible for any amounts due on previously filed joint returns. In order to qualify for Spousal Relief, you must meet certain conditions.
Innocent Spouse Relief: By requesting innocent spouse relief, you can be relieved of responsibility for paying tax, interest, and penalties if your spouse (or former spouse) improperly reported items or omitted items on your tax return. Generally, the tax, interest, and penalties that qualify for relief can only be collected from your spouse (or former spouse). However, you are jointly and individually responsible for any tax, interest, and penalties that do not qualify for relief. The IRS can collect these amounts from either you or your spouse (or former spouse).
You must meet all of the following conditions to qualify for innocent spouse relief. You filed a joint return which has an understatement of tax due to erroneous items of your spouse (or former spouse). You establish that at the time you signed the joint return you did not know, and had no reason to know, that there was an understatement of tax. Taking into account all the facts and circumstances, it would be unfair to hold you liable for the understatement of tax. A request for innocent spouse relief will not be granted if the IRS proves that you and your spouse (or former spouse) transferred property to one another as part of a fraudulent scheme. A fraudulent scheme includes a scheme to defraud the IRS or another third party, such as a creditor, ex-spouse, or business partner.
Continued next week
If you have a specific question regarding this article, as a public service, and at no cost to you, I invite you to call me with your question. Thank you for your interest in reading my tax column. This column is offered as a public service with the understanding that each person's tax situation is different; that you should consult your CPA before taking any action based upon comments made in this article.
Call me and I will be happy to explain my “CPA Quality Tax Preparation at H&R Block Rates”™, my Virtual Tax Office eMail-Order Tax Return Discount and how you can, in general, minimize your tax preparation fees regardless of who prepares your tax returns. To read previously published tax articles go to www.danghazel.com. You can contact me at info@danghazel.com or call me at 305-451-4224.

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