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Separation Of Liablity Relief

On Behalf of | Apr 10, 2024 | Solutions To Tax Controversies

When spouses file a joint tax return, each spouse is responsible for the entire tax liability.  This is referred to as joint and several liability.  Joint and several liability survives the divorce of the spouses even if the corresponding Divorce Decree states that one (1) of the spouses is solely responsible for any particular tax liability.

Separation of Liability Relief is applicable to issues of understated tax in regard to joint and several liability.  Separation of Liability Relief is an allocation of the tax, penalties, and interest between the requesting spouse and the other spouse or former spouse.  In general, the allocated amount, to the requesting spouse, is no more than the amount for which he or she is actually responsible.

To qualify for Separation of Liability Relief, you must have filed a joint tax return and you must meet either of the following conditions:  (i) you are no longer married to or are legally separated from the spouse with whom you filed the joint tax return; or (ii) for the relevant twelve (12) month time frame, you were not a member of the same household as the spouse with whom you filed the joint tax return.