The Utah State Tax Commission has a program called an offer in compromise. This offer in compromise may be an alternative for resolving your Utah tax debt. The Tax Commission accepts an offer in compromise for less than the amount owed when there is doubt if (1) you owe the liability, or (2) the liability can be collected in full and your offer is reasonable. This program is available for income tax, sales tax, personal penalty assessment, and basically any type of tax the Utah State Tax Commission collects against. Each situation is unique so it is difficult to know whether an offer in compromise would be a worthwhile option for you. It is not uncommon for the Commission to reject offers, but under the right circumstances offers will be accepted. If you would like Paul to help you evaluate your position click here to contact Paul.
When you file a joint income tax return, the law makes both you and your spouse responsible for the entire tax liability. This is called joint and several liability. Joint and several liability applies not only to the tax liability you show on the return but also to any additional tax liability the IRS determines to be due, even if the additional tax is due to the income, deductions, or credits of your spouse or former spouse. You remain jointly and severally liable for taxes, and the IRS still can collect from you, even if you later divorce and the divorce decree states that your former spouse will be solely responsible for the tax.
If you believe that only your spouse or former spouse should be held responsible for all or part of the tax, you can request relief from the tax liability, plus related penalties and interest. To request relief, you must file Form 8857. The IRS will use the information you provide on the form and any attachments to determine if you are eligible for relief. There four types of relief are available. They are:
- Innocent spouse relief
- Separation of liability relief
- Equitable relief
- Relief from liability arising from community property law
Each type has specific criteria by which the IRS will grant relief. If you need assistance completing Form 8857 or if you have been denied relief contact Paul to discuss your situation by clicking here.