Joint and Several Liability on Joint Returns. When spouses file a joint income tax return, each spouse is liable for the whole tax (joint and several liability). Under Internal Revenue Code §6015, and detailed regulations under that section, spouses and former spouses can be relieved of that liability with respect to income attributable to the other spouse, and community property laws are ignored in determining to whom income is applicable. Under subsection (b), relief is available to a spouse who did not know or have reason to know of an understatement of tax on a return and it would be inequitable to hold that spouse liable for the deficiency . That standard may be difficult to meet. However, under subsection (c) a divorced or legally separated spouse or a spouse who has lived apart from the other for an entire year - measured at the time relief is sought - may be able to limit his or her tax to the amount attributable to his or her separate income and deductions. If the spouse had actual knowledge of the misreporting at the time of filing the return or participated in a fraudulent scheme, relief is unavailable. Finally, under subsection (f), the IRS can grant relief when it is not available under the other subsections if it would be inequitable to hold the spouse liable.
Reporting Half of Community Income on Separate Returns. Generally, if married people in a community property state file separate tax returns, each must report half of their combined community property income. Under Internal Revenue Code §879, different rules may apply if one spouse is a nonresident alien.
Under Internal Revenue Code §66, and detailed regulations under that section, a person may be relieved of having to include certain community income on his or her return. For example, if the spouses have lived apart all year or if it is inequitable to require one spouse to include half of the income earned by the other spouse, relief may be available.