5 Signs You Might Qualify as an Innocent Spouse

Dealing with the IRS can be daunting, especially when tax issues arise due to actions taken by your spouse or ex-spouse. Fortunately, the IRS provides relief under the “Innocent Spouse” provision, allowing you to avoid liability for taxes owed due to your spouse’s actions. Here are five signs that you might qualify as an innocent spouse:

1. Lack of Knowledge About Underreported or Unreported Income

If your spouse or ex-spouse failed to report or underreported their income, and you had no knowledge or reason to know about this discrepancy, you might qualify for innocent spouse relief. This is common in situations where one spouse handles all financial matters, leaving the other in the dark about their true financial situation.

2. Unaware of Falsified Deductions or Credits

Your spouse may have claimed deductions or credits that were not legitimate, and you were unaware or had no reason to know about these falsifications. If you signed a joint tax return without knowing that it contained false information, you could be eligible for relief.

3. Deceived by a Spouse Regarding Tax Payments

If your spouse told you that they would file the return or pay the taxes owed and failed to do so, you might qualify for innocent spouse relief. This sign is particularly relevant if you were misled into believing that your tax obligations were met when, in fact, they were not.

4. Economic Hardship if Held Responsible

The IRS considers whether holding you responsible for the tax debt would cause significant economic hardship. If you can demonstrate that being held liable for the tax debt would leave you unable to meet basic living expenses, you may qualify for relief.

5. Abuse Affecting Your Ability to Challenge the Tax Return

In cases of abuse, where one spouse was prevented from questioning or challenging the tax return due to fear of retaliation, the IRS may grant innocent spouse relief. This provision recognizes the impact of abuse on one’s ability to oversee or question financial decisions, including those related to taxes.

If you believe you qualify as an innocent spouse, you’ll need to file the correct forms with the IRS. It’s also wise to consult with a tax professional or attorney who can guide you through the process and help strengthen your case.

Remember, each situation is unique, and the IRS considers various factors before granting relief. Understanding these signs can help you determine whether you might qualify for innocent spouse relief, offering a way out of a challenging financial situation caused by your spouse’s tax actions.