US Federal Tax Services - Innocent Spouse Claims
The elimination of the two-year deadline means that an individual seeking to avoid joint liability for tax because of the other spouse's actions may file a request for equitable relief within 10 years of the IRS's assessment of tax, penalties and interest for the year(s) at issue.
If one is seeking a credit or refund of tax, the request for equitable relief generally must be filed within three years from the time the return was filed or two years from the time the tax was paid, whichever period expires later. (If no return was filed, the claim for credit or refund generally must be made within two years from the time the tax was paid).
If you have already submitted a request for relief under §6015(f), the IRS will consider the request even though it was submitted more than two years after the IRS first began collection activity against you, so long as the limitations periods described above were open when the request was originally filed.
If your request for relief under §6015(f) was previously denied and you never appealed the decision to a court, you may re-apply for relief by filing a new Form 8857, Request for Innocent Spouse Relief.
The good news is that the IRS will treat the original Form 8857 as a claim for refund for purposes of the refund limitations period described above, thus any amount for which a refund was available as of the date the original Form 8857 was filed, and any amounts later collected by the IRS, may be refunded if relief is granted.
The IRS will only grant relief for unpaid liabilities if the period of limitations on collection described above remains open as of the date of the re-application.
If the court has already denied relief in your case on the grounds that the request was made after the IRS's two-year deadline (and the decision is final), because the IRS agreed that your request for relief would have been granted had it been filed within the two-year window, the change in the IRS's policy described above means that they no longer will seek to collect from you the underlying liability for which equitable relief would have been granted. However, the IRS may pursue collection of other unpaid tax liabilities.
Please contact our office if you have other tax liabilities so that we can pursue collection alternatives such as an installment agreement or offer in compromise.
Recent changes in the IRS's policy regarding Innocent Spouse Relief may present a new opportunity for you to seek relief on equitable grounds under Internal Revenue Code §6015(f).
The IRS originally established a two-year deadline for requesting equitable relief to encourage prompt resolution and to consider evidence while it remained available.
Effective July 25, 2011, however, the IRS no longer will require that a spouse submit a request for equitable relief within two years of when the IRS first began collection activity against such spouse.