If you are married, separated or divorced, you probably filed your federal income tax returns as “married, filing jointly”. This makes sense because filing jointly gives you certain tax benefits. However, it also makes you and your spouse jointly liable for all the taxes, interest and penalties that might be owed on the joint return, even if you later get divorced.
Do I Owe the Money?
Each spouse, independently of the other, can be made to pay the entire debt to the IRS. Also, one spouse may be held responsible for all the taxes even if all the income was earned by the other spouse. It doesn’t matter what your separation agreement or divorce judgment says. The IRS didn’t sign the agreement and it wasn’t a party to the judgment. It just wants the money.
But I Didn’t Know . . . .
The terrible truth is that the innocent spouse often doesn’t know about the problem until they get a letter from the IRS demanding money. The letter prompts the innocent spouse to start asking questions - and the truth is revealed. Unfortunately, at this point, they are trying to climb out of a hole that their husband or wife put them in.
What Can I Do?
If you qualify as an “innocent spouse”, you can ask for relief from the IRS for the taxes, interest and penalties that you might otherwise have to pay because of the joint tax return. Generally speaking, you can qualify if you filed a joint return but did not know – and had no reason to know – that the your husband or wife was intentionally under reporting income or intentionally violating federal tax laws. Three separate types of relief are available: innocent spouse relief; separation of liability from the offending spouse; and equitable relief. One of these might fit your situation.
You are Not Alone
The situation you might be facing is more common than you think. The IRS gets over 50,000 requests a year for innocent spouse relief. Due to the volume of requests the IRS has dedicated one office (the Cincinnati Service Center) to focus solely on these claims. Don’t be shy about asking for relief. It won’t hurt to ask, and it might help tremendously.
You can learn more about innocent spouse relief directly from the IRS by clicking here.