Tuesday, 10 July 2012

Tax Debt Settlement

Each individual is evenly responsible for all interest, penalties and tax debt settlement when a joint tax return is filed for that particular year. Regardless if the couple is divorced and the divorce decree states that only one of them is liable for any taxes owed, the states or IRS has the legal right to go after both individuals or just one for the tax amount that is owed.

For tax debt settlement, the Innocent Spouse Relief was developed by the IRS as they realized that there may be certain situations that would be unreasonable to pursue both spouses accountable for the tax debt that was brought into existence. Typically, there are three forms of spouse relief that would enable one spouse not to be liable to pay the tax. Even if they end up not qualifying for one, they may be eligible for another.

# The first form is the original Innocent Spouse Relief:

This classic type is the newer version which has been divided up between this section and the other two. This particular form relieves a spouse's full responsibility for paying any of the understatement of taxes that are owed. However, they must meet certain basis to qualify.

# The next form is Separation of Liability:

This form of spouse relief allocates the tax between both individuals as if they filed separate tax returns. The amount is assigned established by the amount each is liable for.

# The third form is Equitable Relief:

This form of spouse relief was designed to protect individuals that perhaps don't qualify for the first two types of spouse relief but would still seem unfair to make them liable for the tax that is owed. Different than the other two forms, Equitable Relief enables a person to put into use if they have either underpaid tax or understated tax.

# Requirements for Requesting Innocent Spouse Relief:

First and foremost, it is extremely important to request innocent spouse relief correctly the first time around because if it is denied the likelihood of applying again for those years in question is unlikely to be accepted. The IRS has certain forms that are required and they strongly recommend that a letter explaining your situation in great detail accompanies those forms to make a more informed determination. The filing of IRS innocent spouse relief can take up much of your time and is monotonous, so do it right and be sure you can meet the requirements for one of the relief forms.

If you need some help with filing spouse relief forms, you can always seek the advice from an experienced tax relief attorney.

For more information like this and other related tax issues, visit www.irstaxreliefattorneys.net website about IRS Tax Relief. They can prevent IRS bank & wage levies, prevent or lift tax liens, stop wage garnishment and will continually strive to get you the best possible settlement.

No comments: