Stop losing sleep over your tax situation. I'm Darrin Mish \u2014 a tax attorney in Tampa who's spent 32 years handling exactly this kind of problem. Here's what you need to know.<\/p>\n
The IRS has extended the time given to innocent spouses to seek relief from their tax liabilities. \u00a0In the past, the time limit for innocent spouses was two years. \u00a0This meant that if you are an innocent spouse seeking equitable relief from the tax that you and your spouse are jointly and severally liable for, you have two years from the time the IRS initiates collection efforts to file for such relief.
\nBut the recent IRS review of the regulation has seen the time limit removed for certain relief requests. \u00a0The policy and program changes will be effective in the fall of this year and the IRS will be issuing additional guidelines for those to whom this matter concerns.
\nThe long-debated issue of the two-year time limit is due to the fact that if you sign the tax submission forms with your spouse (or ex-spouse), are jointly and severally liable for all taxes so you can\u2019t say you just want to pay your share.
\nSo to absolve yourself from the tax liability, you would have to prove that you are innocent, i.e. that you had no knowledge or reason to know about the outstanding taxes.
\nOn this matter, IRS Commissioner Doug Shulman said, \u201cIn recent months, it became clear to me that we need to make significant changes involving innocent spouse relief<\/a>. \u00a0This change is a dramatic step to improve our process to make it fairer for an important group of taxpayers. \u00a0We know these are difficult situations for people to face, and today\u2019s change will help innocent spouses victimized in the past, present and the future.\u201d
\nAmong the changes affecting equitable relief are:
\n1. The two-year limit to new equitable relief requests or requests currently being considered by the IRS no longer applies.2. If your equitable relief request was previously denied due to the two-year limit, you may reapply using IRS Form 8857 (Request for Innocent Spouse Relief), if the collection statute of limitations for the tax years involved has not expired.<\/a> \u00a0Furthermore, if your case is currently in suspense, it will be automatically under the new rule and you should not reapply.3. The IRS will not apply the two-year limit in any pending litigation involving equitable relief, and where litigation is final, the IRS will suspend collection action under certain circumstances.
\nWith the impending changes, it is hoped that many more genuinely innocent spouses would find the relief due to them.<\/p>\n