Saturday, January 14, 2012

IRS issues proposed guidelines to provide relief to more innocent spouses

A Notice proposing a new revenue procedure, revises the threshold requirements for requesting equitable relief and revises the factors used by the IRS in evaluating these requests. The new guidelines are available immediately and will remain available until the finalized revenue procedure is published. The IRS will immediately begin using these new guidelines when evaluating equitable relief requests. This is the second major change made to the innocent spouse program. In July, the IRS extended help to more innocent spouses by eliminating the two-year time limit that previously applied to requests seeking equitable relief.

this proposed revenue procedure expands how the IRS will take into account abuse and financial control by the nonrequesting spouse in determining whether equitable relief is warranted

provides that abuse or lack of financial control may mitigate other factors that might otherwise weigh against granting equitable relief

provides for certain streamlined case determinations

provides new guidance on the potential impact of economic hardship

revises the weight to be accorded to certain factual circumstances in determining equitable relief

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