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Three Types of Relief at a Glance

 

Factors

Innocent Spouse Relief §6015(b)

Allocation of Liability §6015(c)

Equitable Relief §6015(f)

Equitable Relief Community Property States §66(c)

Type of Returns

Joint

Joint

Joint

Married filing separate

Type of Liability

Deficiency

Deficiency

Deficiency or underpayment

Deficiency or underpayment

Special Requirements

 

 

Relief under §6015(b) and §6015(c) not available

 

Refunds Subject to Internal Revenue Code 6511

Refunds available

 

 

No refunds

 

Refunds available for separate payments made solely by the Requesting Spouse and for payments where the Requesting Spouse provided the funds for joint payments.

Refunds available for separate payments made solely by the Requesting Spouse and for payments where the Requesting Spouse provided the funds for joint payments.

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

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

Knowledge considered as an equitable factor

Equity

Inequitable to hold TP liable: consider all facts & circumstances

 

Inequitable to hold TP liable: consider all facts & circumstances

 

 

Inequitable to hold TP liable: consider all facts & circumstances

Required Factors Streamlined Determinations

 

 

Relief will be granted if all of the following conditions are met:

  1. No longer married, legally separated, OR living together for 12 months prior to request
  2. No knowledge or reason to know when return signed; knowledge can be overcome by factors of abuse or financial control
  3. TP will suffer economic hardship if relief not granted

Relief will be granted if all of the following conditions are met:

  1. No longer married, legally separated, OR living together for 12 months prior to request
  2. No knowledge or reason to know when return signed; knowledge can be overcome by factors of abuse or financial control
  3. TP will suffer economic hardship if relief not granted

Equitable Relief Factors (not all inclusive)

 

 

  1. Factors can be For Relief, Against Relief, or Neutral: Marital status (same as 6015(c))
  2. Economic Hardship (defined in Regs. §301.6343-1(b)(4))
  3. Non requesting spouse's legal requirement to pay the liability
  4. No knowledge or reason to know (that liability would not be paid (for underpayment) or of item (for deficiency)
  5. Significant Benefit
  6. Compliance with Income Tax Laws
  7. Abuse (but not duress)
  8. Mental or physical health
  9. Any other facts or circumstances that may weigh for or against relief
  1. Factors can be For Relief, Against Relief, or Neutral: Marital status (same as 6015(c))
  2. Economic Hardship (defined in Regs. §301.6343-1(b)(4))
  3. Non requesting spouse's legal requirement to pay the liability
  4. No knowledge or reason to know (that liability would not be paid (for underpayment) or of item (for deficiency)
  5. Significant Benefit
  6. Compliance with Income Tax Laws
  7. Abuse (but not duress)
  8. Mental or physical health
  9. Any other facts or circumstances that may weigh for or against relief

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

  1. Fraudulent return or
  2. Assets transferred as part of fraudulent scheme

Relief not available if

  1. Fraudulent return or
  2. Assets transferred as part of fraudulent scheme

Disqualified Assets Transferred for Avoidance of Tax or Payment of Tax   

Transfer of disqualified assets 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

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

Exception for equitable relief

Exception for equitable relief

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: 28-Nov-2016