IRS Relaxes “Innocent Spouse” Relief Rules

The IRS has significantly lowered the bar for innocent spouse relief. The rules of the game have changed. A spouse who was denied relief under the old rules should consider applying for innocent spouse relief under Notice 2012-8, provided the ten-year collection statute has not expired on the taxes in question.

Spouses filing taxes jointly make a very special commitment. Aside from being already committed to marriage, joint filing makes them jointly and severally liable for those taxes, or any problems.

This can create a significant problem when one spouse runs afoul of the tax laws. Why? It can drag the other spouse into the matter, unless you can convince the IRS to grant “innocent spouse relief.” Luckily, what was once very tricky might now be much easier to achieve.

An article from Forbes last month is worth a look, as it details how the IRS may have lowered the bar for innocent spouse relief. Essentially, a new memorandum from the IRS has issued a set of eight factors to weigh for the determination of the need for spousal relief. With these new criteria (such as “economic hardship” and “nonrequesting spouses legal obligation”) the playing field is now much more level for spouses dragged into a sticky situation.

If you want to know more, check out the original article which provides more details on obtaining available relief.


Reference: Forbes (January 29, 2012) “IRS Lowers Bar for Innocent Spouse Relief

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