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How can someone qualify for innocent spouse relief?

On Behalf of | Apr 15, 2022 | Uncategorized |

When you file a joint tax return with your spouse, it’s human nature to trust that they’re not hiding anything. Unfortunately, that isn’t always the case. Fortunately, there is hope for people in Texas when their spouses try to avoid paying taxes. It’s called innocent spouse relief, and here’s a closer look at how it works.

Who qualifies for innocent spouse relief?

For you to qualify for innocent spouse relief, there are four conditions that must be met. Here’s a closer look at these conditions whether dealing with your current or former spouse:

  1. You and your spouse’s joint tax return contains erroneous items due to your spouse.
  2. Considering the circumstances, it wouldn’t be fair to solely hold you liable for an understatement of tax.
  3. You either didn’t know or had no reason to know that your spouse made an understatement of tax when you signed a joint tax return.
  4. You and your spouse haven’t transferred any property to each other in an attempt to defraud the IRS, creditors, business partners, or ex-spouse.

What are erroneous items?

Unless you have a clear understanding of tax law, the term “erroneous items” might seem unfamiliar to you. Fortunately, it is fairly simple to explain.

A few things can qualify as erroneous items on tax returns. Unreported gross income qualifies as an erroneous item. Other erroneous items include any incorrect credit, deduction, or property basis claimed on a tax return.

It’s rarely wise to keep the IRS waiting. If you qualify for innocent spouse relief, it’s important to make this known as soon as possible. By doing so, you might save yourself a lot of money.