Three Types of Relief at a Glance |
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Factors
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Innocent Spouse Relief
§6015(b)
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Allocation of Liability
§6015(c)
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Equitable Relief
§6015(f)
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Equitable Relief Community Property States
§66(c)
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Type of Returns |
Joint |
Joint |
Joint |
Married filing separate |
Type of Liability |
Deficiency |
Deficiency |
Deficiency or underpayment |
Deficiency or underpayment |
Special Requirements |
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Relief under § 6015(b) and §6015(c) not available |
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Refunds Subject to Internal Revenue Code 6511
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Refunds available |
No refunds |
Refunds available for: Underpayment - if payments are made solely by the RS. Deficiency - payments made solely by the RS after claim filed and pursuant to installment agreement (not defaulted). |
Marital Status |
Marital status considered as an equitable factor |
Must be divorced, widowed; legally separated; OR not living together for at least 12 months prior to the election |
Marital status considered as an equitable factor |
Knowledge |
TP must establish had no knowledge OR reason to know |
IRS must establish TP had actual knowledge of deficiency items |
Knowledge considered as an equitable factor |
Equity |
Inequitable to hold TP liable: consider all facts & circumstances |
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Inequitable to hold TP liable: consider all facts & circumstances |
Required Factors Tier I |
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Tier I Cases (Relief ordinarily granted if all 4 factors met)
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Underpayment
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No longer married, legally separated, OR living together for 12 months prior to request
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No knowledge or reason to know when return signed
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TP will suffer economic hardship if relief not granted
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List of Partial Factors Tier II |
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Tier II Cases - Underpayment and Deficiency
Equitable Relief Factors
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Marital status (same as 6015(c))
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Economic Hardship (defined in Regs. §301.6343-1(b)(4))
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Non requesting spouse's legal requirment to pay the liability
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No knowledge or reason to know (that liability would not be paid (for underpayment) or of item (for deficiency)
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Significant Benefit
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Compliance with Income Tax Laws
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Abuse (but not duress)
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Mental or physical health
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Fraud |
Fraud is a consideration in equity determination |
Election invalid if IRS shows TP transferred assets as part of a fraudulent scheme |
Relief not available if
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Fraudulent return or
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Assets transferred as part of fraudulent scheme
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Disqualified Assets Transferred for Avoidance of Tax or Payment of Tax |
Transfer of disqualified assts is a consideration in equity determination |
Amount of allocation is increased by value of disqualified assets |
Relief not available to extent of value of any disqualified assets |
Time for Filing |
2 years from 1st collection activity against the RS after 7/22/98 |
2 years from 1st collection activity against the RS after 7/22/98 |
2 years from 1st collection activity against the RS after 7/22/98 |
Consideration in Courts |
Tax Court; if full-paid, District court or Court of Federal Claims |
Tax Court |
Tax Court review of IRS's possible abuse of discretion |
Tax Court review if part of deficiency proceedings or under Collection Due Process proceedings |
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Page Last Reviewed or Updated: November 25, 2008