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Tax Policy: Information on the Joint and Several Liability Standard

GGD-97-34 Published: Mar 12, 1997. Publicly Released: Mar 12, 1997.
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Highlights

Pursuant to a legislative requirement, GAO reported on several issues related to the joint and several liability standard that applies to jointly filed federal income tax returns, focusing on: (1) the potential universe of taxpayers that may be eligible for innocent spouse relief; (2) the Internal Revenue Service's (IRS) practices and procedures for handling requests for innocent spouse relief; (3) whether the innocent spouse provisions provide the same treatment for all taxpayers; (4) the potential effects of replacing the joint and several liability standard with a proportionate liability standard; (5) the potential effects on IRS of requiring it to abide by the terms of divorce decrees when those decrees allocate tax liabilities; and (6) the potential effects on IRS of changing the law so that community income of one spouse cannot be seized to satisfy tax liabilities incurred by the other spouse before their marriage.

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Internal Revenue Service To improve IRS' administration of the innocent spouse provision of the tax code, the Commissioner of Internal Revenue should develop new or modify existing publications to better inform and educate taxpayers about the availability of and criteria for innocent spouse relief and, as part of that effort, develop a tax form and procedures for requesting and either granting or denying innocent spouse relief.
Closed – Implemented
IRS has developed a new form (Form 8857, Request for Innocent Spouse Relief), and has revised its publications.
Internal Revenue Service The Commissioner of Internal Revenue should provide additional internal guidance to IRS employees so that greater consistency in processing innocent spouse cases can be achieved, establish a cost-effective process for monitoring the consistency being achieved, and update IRS' regulations to reflect current requirements.
Closed – Implemented
To ensure consistency in handling innocent spouse claims, IRS stated that the new innocent spouse form is being processed in one central location, training is being given to Examination and Collection staff, and telephone assistors trained in innocent spouse provisions are available to answer questions received through IRS' toll-free telephone system.

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Topics

Divorced personsEligibility criteriaGovernment publicationsPersonal liability (legal)Tax administrationTax lawTax nonpaymentTax return auditsTax returnsTaxpayersMarital status