More Time for Innocent Spouse

Back in April, I wrote an Our Taxing Times post outlining the differences between the IRS’s injured spouse and innocent spouse programs. At that time, the innocent spouse program was in the news because there were requests from Capital Hill that the IRS increase the time a potential innocent spouse has to request tax protection. At the time, the taxpayer had 2 years to request inclusion in the Innocent Spouse Program. Time started with the first collection notice.

Yesterday, the IRS announced new time guidelines for Innocent Spouse relief. Under the new rules, the 2 year time limit will not be enforced. If the taxpayer was previously denied because of the 2 year rule and the collection period is still open, they can re–request consideration with a new Form 8857. Details are spelled out in Notice 2011-70 and are effective immediately.