According to the Internal Revenue Service (IRS), many married couples in the United States file their taxes together. Yes, filing a joint tax return with your spouse has its benefits, but it may also require you to assume partial responsibility for errors made by your spouse – whether inadvertent or unintentional. If you and your spouse are under investigation by the IRS because of a mistake on your tax return that you didn’t know about, you need an attorney to stand up for your rights against aggressive IRS criminal investigators. Without a top-notch attorney fighting for you, it may be difficult to demonstrate your innocence during the investigation.
There are three defenses used by innocent spouses to avoid tax crime penalties:
Each defense has different qualifications. In short, you may be eligible to receive innocent spouse relief if you had no knowledge or reason to know about the error. To qualify for separation liability, you and your spouse must be divorced, legally separated or members of a separate household. If you are not eligible for innocent spouse relief or separation liability relief, you may qualify for equitable relief. If you are still married but had no knowledge or reason to know about the mistake on your tax return and you can demonstrate that the mistake was not made as part of a fraudulent tax evasion scheme, you may be granted equitable relief.
In order to qualify for an innocent spouse defense, you must have filed a joint tax return with your spouse. The return must contain an erroneous item and you must be able to show the IRS that, when you signed the return, you had no knowledge or reason to know about the mistake. According to the IRS, an erroneous item may be any form of unreported income, an incorrect deduction or incorrect credit.
Actual knowledge refers to whether or not you were aware of the mistake. If you signed the return knowing that it was in error, you will not qualify for innocent spouse relief. If a hypothetical, reasonable person in the same situation wouldn’t have known about the mistake, then you may still qualify. However, if you claim that you didn’t’ know about the mistake but a reasonable individual in your situation probably would have, the IRS may not accept your petition for innocent spouse relief.
Other factors that the IRS may take into consideration include:
Once the IRS takes all of these factors into consideration, it will determine whether or not you qualify for innocent spouse relief.
If you need help filing for innocent spouse relief, talk to an attorney from Okabe & Haushalter today. We are ready to help you understand your legal circumstances and stand up for your rights in court. Just because your spouse’s tax return was deficient doesn’t mean that you should have to pay the price – schedule a case evaluation with a lawyer from the firm today.