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Special study on Taxpayer First Act of 2019

Innocent spouse relief

In general, married couples who file tax returns jointly are both responsible for the entire tax liability that should be reported on the return. However, under certain circumstances, the tax code provides relief from joint liability for certain innocent spouses. ( Code Sec. 6015 ) One such type of relief is equitable relief; this relief is granted only if, taking into account all facts and circumstances, it is inequitable to hold the individual liable for the unpaid portion of tax or for a deficiency with respect to the joint return.

New law. The Act provides that the standard of review for innocent spouse relief by the Tax Court is to be conducted on a de novo basis, meaning that the Tax Court would take a fresh look at the case without taking previous decisions into account. The review would be based on the administrative record

and any newly discovered or previously unavailable evidence. ( Code Sec. 6015(e)(7) , as amended Act Sec. 1203(a)(1))

The Act also allows taxpayers to request equitable relief with respect to any unpaid liability before the expiration of the collection period or, if paid, before the expiration of the applicable limitations period for claiming a refund or credit. ( Code Sec. 6015(f) , as amended by Act Sec. 1203(a)(2))

The new provisions are effective for petitions or requests filed or pending on or after the date of enactment. (Act Sec. 1203(b))