Q&A: What is the "Innocent Spouse Rule" as Far as Divorce and the IRS Goes?

It may or may not be tax season when you are reading this but chances are if you found this post via Google, you are concerned about your taxes and probably are afraid that you owe back taxes to the IRS. You probably do, but there are ways to get out of it – there are exceptions, I should say to the usual rule that a spouse is jointly and severally liable for underpayments to the Internal Revenue Service by their spouse where a joint return or a married by filing separately return was filed.

The Innocent Spouse Rule which can be found here, is a rule for couples in community property marriages who file joint tax returns. The general rule as noted above¬†is that a couple is jointly and severally liable for all material on their jointly filed tax returns. But sometimes, a spouse could be “innocent” of the material in the sense that he or she could be in the dark as far as the shenanigans of his or her spouse with respect to tax filings – and in such a case, the IRS deems it “unfair” to hold him or her liable for the tax debts of a conniving spouse.

Within the context of divorce, this is especially important because even after a divorce has been finalized, and up to seven years after the filing of the return, a couple can be audited and if there are under payments either or both can be held accountable for erroneous or fraudulent filings by a former spouse, while they were married.

If you qualify for the exceptions that are carved out by the IRS (for example, you simply were clueless about these matters and everybody knew it) you potentially can get out of this legal and financial quagmire.

And by the way, if there is an overpayment which is paid to your spouse post divorce, you potentially could apply for “injured spouse” relief as well.