Innocence Spouse says a solution for resolving an IRS problem, can be a fantastic solution. It's actually something that's very highly technical, there's actually three different ways to obtain Innocent Spouse relief. I am going to talk about them real quick and which, what they mean and how they manipulate at your particular case.
The first type of Innocent Spouse that I am going to discuss is what I call Classic Innocent Spouse and what that means is that essentially that you were in a relationship, you were married to your spouse and your spouse was less an honest with you about his or her income tax liabilities. Often times they lied to you, perhaps even had you file or sign a false tax return and that through no faults of your own, there is now a joint liability for which you are responsible and you should not be held responsible due to their deception and so on.
The second type of Innocent Spouse is actually called a Separate Liability Election and what that means is that if you don't qualify for Classic Innocent Spouse then you can apply for what is called a Separate Liability Election, what it means is that if you currently, I guess you have a joint liability because you are interested in Innocent Spouse then you can actually apply to have that joint liability separated as if you had both filed married filing separate returns.
So let me give you an example of how that might apply. If the husband spouse was self-employed and didn't make as any income tax payments and the wife spouse was a wage earner that means she received a pay check and had an appropriate withholding from her pay check, then the Separate Liability Election will actually benefit the wife because she is very likely to have had enough withholding or definitely much more withholding and much less of income tax liability if she had filed a separate return. Therefore, a Separate Liability Election could be really great for a person like that.
Or it could actually be a situation where you had two spouses and they are both self-employed, one spouse actually made a tax payments and the other did not, a Separate Liability Election would help in that situation as well. Or a third situation where both spouses were actually both self-employed but one made disproportionately much more money. One spouse made $100,000 and the other spouse made $25,000 and they have separate self-employed incomes, then obviously a Separate Liability Election would help the person who made the least money in that situation.
The third type of Innocent Spouse is what is called Equitable Relief and that means essentially that even though you don't qualify for one of the first two types of Innocent Spouse Relief, that it's unfair to hold you responsible and/or it will create an economic hardship in order to force you to pay. So that means essentially that you don't have the means to repay the liability and that's a key factor in Equitable Relief.
What documentation do you need to apply and sustain in an Innocent Spouse Determination? We need to fill out a form 433A which is called a Collection Information Statement for individuals and self-employed people. Or, and/or -- actually and a 433B if you are actually self-employed or if you have an LLC or a corporation.
So let me make that a little bit more clear. You need to file the form 433B if you have a Limited Liability Company or a corporation, you can probably get away with a if you are self-proprietorship, self-employed in that fashion. You also need to fill out a form 8857; you have to provide three months worth of documentation proving your expenses and income in a form 12510.
You need to also provide any proof of your claim to relieve you to tax that. For example, court records showing the dissolution of the marriage or the separation agreement, police records if you are a domestic victim or domestic violence or things of that nature and anything else that you think might be pertinent and relevant to your case.
Now you need to know that if you file a request for Innocent Spouse Relief then your spouse, your ex-spouse, your former spouse will be notified of that attempt to do so. So if the person is violent or what not, you want to make sure that you claim, you make your claim for Innocent Spouse when you are in a situation where you are extremely safe. There is also a time limitation for Innocent Spouse; the claim must be filed within two years of the first collection activity by the IRS.
Now what does collection activity mean? Well, it means a lot of things but it essentially means -- well one of the examples is two years from the date of a final notice of intent to levy.
It can also mean two years from the date that they first kept your refund. So essentially if you have been officially notified in some fashion that you owe the money then the time clock starts to tick two years from that date. Now it doesn't count for just routine statements or bills from the IRS. So you are going to might want to go ahead and have a tax professional if you are interested in doing Innocent Spouse.
Because the thing is, it's actually one of the most complicated IRS problem resolution solutions that one could undertake on their own. You might want to have a tax professional make sure that the two years has not elapsed and help walk you through this process.
If you have questions about Innocent Spouse, if you want assistance in providing an Innocent Spouse application or if you want a thorough analysis on how to best solve your IRS problem, I would invite to visitors website at GetIRShelp.com. You can also call us toll-free at 888-438-6474. We represent clients throughout the state of Florida, throughout the United States and in fact throughout the world.
So I invite you to give us a call and see what we can do to help you with your Innocent Spouse claim. Thanks.
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