Hardship Granted with $63K in the Bank

A taxpayer filing for an innocent spouse relief was granted relief despite an initial denial and $63,000 in her retirement account. In Van Arsdalen v. Comm’r, the US Tax court granted the petitioner relief from her joint tax liabilities. Despite retirement assets being sufficient to pay a large percentage of the liability.

The IRS initially denied relief on the grounds that she could pay. However, given her age, the number of children, and the tax attorney’s skill, the Tax Court overruled the IRS. They even went so far as to say that the IRS abused its discretion.

Systemic IRS Abuse

Sound crazy? It is. It is also all too common. Publicly available records, including reports by the government-funded watchdog for the IRS, the taxpayer advocate, indicate that the IRS frequently abuses its discretion in these kinds of matters.

The IRS often aggressively denies relief to taxpayers seeking innocent spouse relief. However, the judicial and legislative history surrounding IRC §6015 Innocent Spouse relief has been significantly more generous than the IRS usually provides. This pattern of IRS abuse has been present since the initial legislation was passed.

How does this keep happening?

In many cases, unfortunately, taxpayers who go it alone receive denials without realizing they have a legitimate claim. All the judicial, legislative, and IRS guidance on their side doesn’t matter if they don’t realize it exists. After all, the IRS certainly isn’t telling them their denial is shaky at best.

Given that a person likely files one claim in their lifetime, it is easy to see how the IRS can stonewall a legitimate claim. This means that claimants regularly walk away from their legal right to relief. All because the IRS has the knowledge and experience bluffing that it needs to win; even when the facts are in your favor.

How To Protect Your Innocent Spouse Rights

If you think your claim was wrongfully denied you are likely right. Approximately, 50% of rejected innocent spouse claims appealed are eventually approved. If you are considering filing or already filed, professional help can make the difference between continued denials and quick resolution. Rather than struggling, let us guide you through the process. Make sure your voice is heard.

Serving Central & Northern Maine 

If you struggle with an innocent spouse issue at the Internal Revenue Service and you live in central or northern Maine, give us a call for a zero-risk initial consultation. Located in Bangor. We work with clients regularly from southern Maine, through Augusta, and all the way up to Fort Kent. If you are outside of our home state and want a second opinion, consider giving us a call. We regularly work with out-of-state referrals.

Great Outcomes

J.P. Oltmann is proud to provide tax representation for individuals and small businesses across Maine.

Helping Clients Achieve Their Personal,
Professional, and Financial Goals in the
Wake of a Tax Controversy

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