ISR 101: 3 Types of Relief from Joint and Several Liability

• Instructor: Attorney Bob Schaller
• Lectures: 9
• Quizzes: 1

Three Types of Relief from Joint and Several Liability.

Many married taxpayers choose to file a joint tax return because of benefits this filing status affords them but ignore the detriments.  When filing jointly, both taxpayers are jointly and severally liable for the tax and any additions to tax, interest, and penalties that arise from the joint return even if they later divorce.  26 U.S.C. § 6013(d)(3); 26 C.F.R. § 1.6015-1(a); Haag v. Comm. of Internal Revenue, 683 F.3d 26, 29 (1^st Cir. 2012); Rubel v. Comm. of Internal Revenue, 856 F.3d 301, 303 (3^rd Cir. 2017); Pullins v. Comm. of Internal Revenue, 136 T.C. 432, 437 (2011).  Joint and several liability means that each taxpayer is legally responsible for the entire liability shown or that should have been shown on their joint return.  Manella v. Comm. of Internal Revenue, 631 F.3d 115, 117 (3^rd Cir. 2011).  Thus, both spouses on a married, filing jointly return are generally held responsible for all the tax due even if one spouse earned all the income or claimed improper deductions or credits.  This is true even if a subsequent divorce decree states that a former spouse will be responsible for any amounts due on previously filed joint returns.

Thankfully, Congress has provided spousal relief from joint and several liability for income taxes (including additions to tax, penalties, and interest) in certain circumstances.  See 26 U.S.C. § 6015; 26 C.F.R. § 1.6015-2(a).  Tax Code § 6015 provides several types of relief from joint and several liability of a joint return.  26 U.S.C. § 6015; Christensen v. Comm. of Internal Revenue, 523 F.3d 957, 960 (9^th Cir. 2008) (relief not available to taxpayer who filed individual return).  The Tax Code authorizes the Secretary of the Treasury to prescribe rules and regulations to implement § 6015 of the Tax Code.  See 26 U.S.C. § 6015(h) and 26 U.S.C. § 7805(a); Haag v. Comm. of Internal Revenue, 683 F.3d 26, 29 (1^st Cir. 2012).  A taxpayer seeks relief by filing Form 8857, Request for Innocent Spouse Relief.

Section 6015’s three avenues of relief are “Innocent Spouse Relief,” “Separation of Liability Relief,” and “Equitable Relief.”  Note that throughout this and the next few courses, the spouse seeking relief from the IRS is identified as the “Requesting Spouse”; the other spouse will be identified as the “Non-Requesting Spouse” – whether married, separated, or divorced.