Question

In: Accounting

Which of these factors weigh in favor of granting relief?

Tax Audit & Notice Services: Requesting Innocent Spouse Relief (2019) Options

7   Which of these factors weigh in favor of granting relief?

a     The taxpayer is unable to pay basic living expenses.
b     The taxpayer received no significant financial benefit.
c     The taxpayer had no knowledge of the deficiency.
d     All of the above.

Solutions

Expert Solution

c. The taxpayer had no knowledge of the deficiency

To be eligible for Innocent Spouse relief, the taxpayers must meet the following criteria:

  • They must have filed a joint return with an erroneous understatement of tax responsibility relating directly to their spouse.
  • They must have had no knowledge of the error.
  • Once the error has been identified, the IRS must agree that it is fair to relieve the taxpayer of the tax in question.
  • The taxpayer must apply for relief within two years of the IRS initiating collection.

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