Innocent Spouse Relief Explained: Tax Relief for Spouses

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Gregory W. Mitchell

Gregory W. Mitchell



Gregory Mitchell joins Freeman Law to lead its bankruptcy practice. Mr. Mitchell is a native of the Dallas area, graduating from Southern Methodist University with a Bachelor’s Degree in Economics in 1991 and with his J.D. in 1994. In 1995, he obtained an LL.M. in Taxation from New York University. Mr. Mitchell currently directs the SMU Dedman School of Law’s federal taxpayer clinic. Mr. Mitchell’s background in tax makes him a natural fit for Freeman Law.

Prior to joining Freeman Law, Mr. Mitchell was the managing partner of The Mitchell Law Firm, L.P., a small firm he started in 2004, where he ran a diverse practice primarily focused on bankruptcy, tax and related litigation matters.

Prior to starting his own firm, Mr. Mitchell served as a Partner and General Counsel with Tax Automation, L.P., a national tax consulting firm. Mr. Mitchell was previously the National Director of Tax Technology at Ryan & Company, a national tax consulting practice, as well as a Senior Manager with KPMG, a “Big Four” accounting firm.

A topic that we frequently see in the Tax Clinic that I run, one that is often misunderstood, is that of innocent spouse relief.

Generally, the purpose of providing innocent spouse relief is to, as one court put it:  “protect one spouse from the overreaching or dishonesty of the other.”  Purcell v. Commissioner, 826 F.2d 470 (6th Cir. 1987).  But many people that come into the clinic think that it means that, if the other spouse earned the income, then they are automatically entitled to innocent spouse relief when the appropriate amount of tax does not get paid.  And that is simply not the case.

As I always do with my students, the place to start is the Internal Revenue Code, and the primary section we’re looking at as it relates to innocent spouse relief is Section 6015 – “Relief from joint and several liability on joint return.”  So Section 6015 starts with the lead-in of “Notwithstanding Section 6013(d)(3)”, so let’s start our analysis there:

Section 6013 generally deals with joint returns by a husband and wife.  Section 6013 (d) provides that, “for purposes of this section” (that’s the section related to joint returns), and then (d)(3) says that “if a joint return is made, the tax shall be computed on the aggregate income and the liability with respect to the tax shall be joint and several.”  For those unfamiliar with the concept of joint and several liability, it’s one that frequently arises in the context of tort litigation, and it simply means that the IRS can go after either spouse for the full amount of the tax – notwithstanding:  (1) Who earned the money; (2) Who was responsible for the finances; or (3) Who was responsible for preparing and filing the returns.

So now we jump back to §6015, and we see that §6015 is going to give us a rule that applies notwithstanding the general rule that both spouses are jointly and severally liable for the entire amount of the tax.  §6015(a) points us to two avenues for relief under §6015 – one described in §6015(b) and another described in §6015(c).  We’ll see that there is a third avenue described in §6015(f).

Relief under §6015(b)

So we’ll start with relief under §6015(b), which provides in §6015(b)(1) that, if a taxpayer satisfies five (5) separate requirements, then a spouse can be relieved of liability to the extent the section applies.  Those requirements are as follows:

Relief Under §6015(c)

As noted above, a second route for obtaining relief under §6015 is found in §6015(c), which provides that a taxpayer who is eligible and so elects may limit his or her liability to the portion of a deficiency that is properly allocable to the other taxpayer as provided in section §6015(d).  This type of relief permits a requesting spouse who is widowed to elect to limit the tax liability to the amount of deficiency that is allocable to him or her only.  A requesting spouse may remain liable for deficiencies not allocable to him if he is found to have had actual knowledge of the erroneous item resulting in the deficiency.  Actual knowledge in this context is determined the same way it is when requesting regular relief.

One exception to the denial based on actual knowledge is in circumstances where domestic abuse prevented the spouse from challenging the erroneous item as a result of a fear of retaliation.

So 6015(c) basically allows the petitioning spouse (the one seeking relief) to go back and pretend as if he or she was filing a separate return.

Relief Under §6015(f)

So finally we turn to the third and final avenue for relief under §6015, and that is found in §6015(f).  Section 6015(f) provides a savings provision whereby, if the IRS determines that it’s simply unfair under all the facts and circumstances to hold one spouse liable – notwithstanding that individual’s failure to satisfy (b) or (c), that the IRS can relieve that individual of liability.

Equitable relief under §6015(f) is available only when a spouse fails to obtain regular or separate return relief.  In the case that the tax has not been paid, any such relief under 6015(f) must be requested prior to the expiration of the applicable statute of limitations under §6502, which is generally 10 years after the assessment (6015(f)(2)(A)).  Where the tax has already been paid, then relief must be requested during the period in which the individual could submit a timely claim for refund, which is determined under § 6511(a) as the later of:  (1) 3 years from the date of filing the return; or (2) years from the time the tax is paid.

A spouse may obtain equitable relief under §6015(f) if the facts and circumstances would make it inequitable to hold her liable for an underpayment or deficiency.  Factors used in making this determination have been memorialized in an IRS Revenue Procedure.  Rev Proc. 2013-34 provides a nonexclusive list of factors for consideration in determining whether relief should be granted, including:

Making an Innocent Spouse Claim

So if we determine that we may qualify for innocent spouse relief, how do we make such a claim?  Form 8857 is the appropriate form, and the instructions generally walk through completing it.  The from walks through a series of questions intended to determine under which provided described above the taxpayer is seeking relief.  Questions are tailored to seek information specific to each avenue of relief.  If you need additional assistance, you can turn to IRS Publication 971, which describes in extensive detail the full process for applying for innocent spouse relief.

So while obtaining innocent spouse relief may not be as simple as many believe, there are multiple avenues for relief designed to address situations where holding one spouse liable for a couple’s full tax liability is deemed to be unfair.


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