Instructions for Form 8857 (06/2021) - IRS

General Overview

• Form Purpose: Request relief from tax liability under certain conditions when a joint tax return was filed.
• Joint and Several Liability: Both spouses are responsible for entire tax liability on joint returns.
• Eligible for Relief: If only one spouse should be responsible for the tax.

Types of Relief

1. Innocent Spouse Relief

   • Applies if there is an understated tax due to erroneous items by the other spouse.
   • Conditions: Filed a joint return, no knowledge of understated tax, unfair to hold liable.

2. Separation of Liability Relief

   • For understated tax if you are divorced, legally separated, or living apart for over 12 months.
   • Not applicable if you had knowledge of the erroneous item.

3. Equitable Relief

   • Applies if it’s unfair to hold liable for understated or unpaid tax.
   • Only option for unpaid taxes shown properly on return.

4. Relief from Community Income

   • Applicable in community property states like Arizona, California, etc.
   • Conditions: Not filed joint return, didn't know of the income item.

Filing Instructions

• When to File: As soon as aware of tax liability believed to be the responsibility of the other spouse. Generally within 2 years of IRS collection attempt.
• Exceptions:
  • Equitable relief: Within time IRS has to collect (usually 10 years) or 3 years for a credit/refund.
  • Community income: 6 months before assessment expiration or 30 days after IRS examination start.

Where to File

• Mail:
  • US Postal: IRS, P.O. Box 120053, Covington, KY 41012.
  • Private Delivery: IRS, 7940 Kentucky Drive, Stop 840F, Florence, KY 41042.
• Fax: 855-233-8558.

IRS Procedures Post-Filing

• IRS must contact your spouse/former spouse.
• Preliminary and final determination letters will be sent.
• Potential to petition Tax Court for review.

Taxpayer Advocate Service (TAS)

• Assistance: Resolves taxpayer issues with the IRS.
• Rights: Taxpayer Bill of Rights available for education.
• TAS Contact: Local directory or 877-777-4778.

Low Income Taxpayer Clinics (LITCs)

• Provide assistance for low-income individuals or those with English as a second language.

Specific Line Instructions

• Line 1 & 2: Determine applicability for Form 8857 and injured spouse allocation Form 8379.
• Line 5: Provide current address and contact details.
• Line 11, 19, 20, 23a, 25: Specific scenarios and evidence required.

Additional Considerations

• Proof Required: For refunds, proof of payment from personal funds is needed.
• Privacy: IRS will not disclose personal information to the spouse except under Tax Court petition.
• Signature: Ensure Form 8857 is signed for processing.
• Paid Preparer: Must sign the form if paid for preparation.

Notices

• Privacy Act: Information confidentiality as per IRC section 6103.
• Paperwork: Estimated time for completion of Form 8857 is approximately 4 hours and 48 minutes.

For further details, visit IRS.gov/Form8857 or consult IRS publications such as Pub. 971 and Pub. 594.