If you file jointly and your spouse has a debt (this can be a federal, state income tax, child support, or spousal support debt) the IRS can apply your refund to one of these debts, which is known as an “offset.” The agency can also take a collection action against you for the tax debt you and your spouse owe, such as filing of the Notice of Federal Tax Lien or issuing a levy. However, if you’re not legally responsible for the past due amount you may still be entitled to receive your share of the refund or request relief from joint and several liability, depending on the facts of the situation. “Joint and several liability” means that each taxpayer is legally responsible for the entire debt, even if you’ve divorced after you filed a joint tax return.
If you feel you are not responsible for the debt, there are two ways to request relief:
Injured Spouse Claim: You can request that you be treated as an injured spouse, if you filed a joint tax return and all or part of a refund is taken to pay a debt owed only by your spouse and not you. See the Injured Spouse page for step-by-step instructions for filing this claim and what information is needed. We also have a short video that explains what injured spouse means and when to file a claim.
Innocent Spouse Relief: For instances involving individual earned income or self-employment taxes only, by requesting innocent spouse relief, you can be considered for relief of responsibility from paying tax, interest, and penalties, if your spouse (or former spouse) improperly reported items or omitted items on your tax return.
Note: Household Employment taxes, Individual Shared Responsibility payments, business taxes and trust fund recovery penalty for employment taxes are not eligible for innocent spouse relief.
The three types of innocent spouse relief available are:
Innocent spouse relief: By requesting innocent spouse relief, you can be relieved of responsibility for paying tax, interest, and penalties if your spouse did something wrong on your tax return.
Separation of liability relief: Under this type of relief, you allocate (divide) the understatement of tax (plus interest and penalties) on your joint return between you and your spouse (or former spouse).
Equitable relief: If you do not qualify for innocent spouse relief or separation of liability, you may still be relived of responsibility for tax, interest, and penalties through equitable relief.
Each type of relief has different requirements. Three Types of Relief at a Glance compares the rules for these three types of relief. You may also want to refer to Innocent Spouse Questions & Answers for more information about these types of relief.
If you file an Innocent Spouse claim, but the IRS denies your claim and you still disagree, see Appeal an Innocent Spouse Determination for next steps to take.
If you have any questions regarding accounting, domestic taxation, essential business accounting, international taxation, IRS representation, U.S. tax implications of Real Estate transactions or financial statements, please give us a call at 305-274-5811