What is Innocent spouse relief?
In short
Spouses who file a joint return are each liable for the full tax. Innocent spouse relief lets one spouse escape tax on an understatement caused by the other spouse's erroneous items that the requesting spouse didn't know, and had no reason to know, about.
Key takeaways
- The three forms are innocent spouse relief, separation of liability and equitable relief.
- It is generally requested on Form 8857 within 2 years after the Internal Revenue Service begins collection.
- It must be inequitable to hold the requesting spouse liable.
Where it's tested
REG: Internal Revenue Service (IRS) Procedures & Appeals — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
A taxpayer wishes to dispute a proposed deficiency without first paying the disputed amount. Which court must the taxpayer use?