Innocent spouse relief.

• Author: Allen, Noelle

There are four requirements that must be met under Sec. 6013(e)(1) for a spouse to obtain relief from the joint and several liability imposed by the filing of a joint return. 1. A joint income tax return must be filed. 2. There must be a substantial understatement of tax (i.e., in excess of $500) attributable to grossly erroneous items of one spouse. Grossly erroneous items are: (a) any item of gross income attributable to the other spouse that is omitted from gross income, or (b) any claim of a deduction, credit or basis in an amount for which there is no basis in fact or law. Note: If the understatement of tax results from an erroneous deduction, the understatement, interest and penalties must be more than: (a) 10% of the taxpayer's adjusted gross income (AGI) for the pre-adjustment year, if his AGI was $20,000 or less, or (b) 25% of the taxpayer's AGI for the pre-adjustment year, if his AGI was more than $20,000. 3. The spouse claiming relief must establish that in signing the return he did not know, and had no reason to know, of the...