When dealing with the emotional issues that come with a divorce, many people may not consider the issues that may come with the tax problems that a former spouse can leave behind. After all, a jointly signed tax return can lead to both parties being held liable in the event one is charged with tax fraud or tax evasion.
Being wrongfully held accountable for a federal crime is probably the least of your worries when getting divorced. But in the event you are, you can take solace in knowing that there are some exceptions that can lead to you being exonerated. This post will discuss them.
Equitable relief – An unwitting spouse can ask for leniency from prosecution because they were not actively compliant in committing fraud, and reasonably believed that the information that their spouse provided on their tax return was truthful and accurate. Also, an unsuspecting spouse can argue that they had no reason to believe that the information included in the form was fraudulent, as they may have had little if any input in completing the return.
Innocent spouse defense – There are also situations where a spouse may have signed a tax return under duress. This commonly applies to spouses who are in abusive relationships and are asked to sign tax forms without knowing their contents or being able to challenge the information provided in them. In these circumstances, abused spouses don’t have the ability to question their tax returns. Because of this, the IRS may have some leniency with a spouse who seeks immunity.