IRS Form 8857

irs form 8857
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Form 8857, along with many other documents of the kind, is used by the United States citizens for reporting their income, tax deductions, expenses, and submitting tax returns. Any taxpayer, whether we are talking about a legal entity or a private person, is obliged to pay taxes and report them in due time and with an appropriate legal form. The financial and accounting operations are definitely complicated for an unprepared person; therefore, you will most likely face particular difficulties submitting this or that IRS form for the first time.

Certainly, you can find detailed and comprehensive instructions on filling the tax forms on the Revenue Service official site. On the other hand, it takes a definite amount of time to study them thoroughly and find out what you need to fill out in this or that situation. To ease the task and avoid serious mistakes, you can use our form-building software with a step-by-step guide and useful tips.

Generally speaking, the 8857 IRS Form is used to absolve one of the spouses (or the former spouses, depending on the reporting period) from the incorrect tax payment responsibility.

Here, we refer to the United States tax legislation, granting the right to one of the spouses for a tax relief, provided that an applicant proves their right and has no intent for misleading. The law regulations were revised in 1998, and Form 8857 was edited in January 2014. The primary goal of this legislative rule was to protect the spouse, who is not entirely aware of the financial situation of their significant other for various reasons.

Two Primary Ways of Reporting the Tax Return

When you are married, you have the opportunity to choose the way you report your income in your tax return:

  • Separately – in this case, every spouse is filling his own tax return form, informing the authorities about his personal financial situation.
  • Jointly, that means that the spouses complete and sign the tax return template together, thus taking full and unconditional joint responsibility for each other and the validity of the information presented to the state authorities.

It seems that separate tax return filing is obviously easier and safer. But many couples prefer to file it together mainly because of the substantial advantages granted by the Revenue Service, including the tax breaks for the following purposes:

  • Earned income credit;
  • Credit for the elderly and disabled;
  • Adoption credit;
  • Child and dependent credit, and many others.

As a result of joint preparation of a tax return, one of the spouses can stay misinformed or deceived concerning incorrect or false information in that document. In order to be relieved from the consequent responsibility, whether he learns about this violation himself or the Internal Revenue Service prescribes to correct it, it is possible to file the IRS 8857 Form. This form includes seven pages to fill out, so we recommend doing it first with the help of our form filling software.

What is the General Purpose of Form 8857?

You should submit this form if you have any reasons to presume that your joint tax declaration had mistakes or incorrect information, and you can prove that it happened only at your spouse’s fault; you have a legal right not to share full responsibility for the possible consequences.

These mistakes, or erroneous positions, for example, may include any received but not reported income, as well as an incorrectly calculated deduction, credit, or basis.

The Revenue Service will consider your request for relief only if you meet the following obligatory requirements:

  1. You have already submitted a tax return together with your spouse, jointly signed;
  2. It contains an error, inaccurate information, or something is missing there only by the fault of your wife or husband;
  3. You must have had no suspicion or information about it when signing;
  4. The IRS concludes that the facts presented in your Form 8857 are credible;
  5. You have filed the application form to the IRS as soon as you have learned about the situation, but no later than two years have passed.

There are some situations defined by the tax laws and regulations when you should not file this form; also, you must consider the difference when you live in a community property state.

How you should Submit the IRS 8857

First of all, you should not send the request for relief together with the tax return. These are different documents, and sending them together will most likely lead to misunderstanding.

Secondly, be very attentive and accurate sending this kind of form for the first time. In the case of denial by the IRS, next time, it would be much more difficult to apply for this type of tax relief. That is why we offer to use our built-in software utility to complete this form because it is a large and complicated document.

The IRS 8857 Form consists of seven pages, including many questions about your personal data, family situation, and financial position; moreover, you will have to describe your education and working experience. The latter is supposedly necessary to estimate your educational and intellectual level and, after that, to estimate whether you are able to understand when you are doing something financially wrong.

During the preparation of this form, you may need to collect some documents to prove the facts you are stating in the application. It is also possible to enclose a separate letter, where you can describe the situation more precisely, especially because some sections of the 8857 Form have not enough place for details. Sometimes this letter is necessary, but even if this additional document is not required, it will certainly help you to prove your right to relief.

The Internal Revenue Service has a certain right to reject your request for the following main reasons:

  • Filing an incorrect tax return could give you some advantages;
  • It is impossible to prove that your spouse (or former spouse) actually deceived you;
  • You have transferred the property to each other so as to diminish your income or hide your property.

Where to Send the IRS Form 8857

When the 8857 Form is completed, do not forget to write your name and SSN (social security number) on any additional documents or letters attached to the request.

Next up, you have to send it by post, using either the official US post or a private delivery service (the addresses are different). You may find the corresponding information on the official IRS internet sources.

Before you reach this point, you can complete this form with the help of our step-by-step guide and our form-building software.

A Reference Guide for Filling out the IRS 8857

The form starts with providing some legal guidance to the applicants, so ensure you get familiar with the designated filling rules and recommendations on the form completion.

filling out an irs form 8857
Put Your Name and SSN at the Top of All Enclosed Documents

There may not be enough free space for your answers in the form. In this case, enclose more pages. And do not forget to add your name and social security number on any additional list, document, or statement you attach to the request.

step 1 put your name and ssn at the top of all enclosed documents - filling out an irs form 8857
Verify Your Situation and Enter the Appropriate Year

Answer “Yes” or “No” in the boxes on line 1. Depending on your answer, go to lines 2 and 3. Be sure that the year you entered on line 3 is correct.

step 2 verify your situation and enter the appropriate year - filling out an irs form 8857
Enter the Information About Yourself

Part II contains questions related to information about you and your spouse (or the former spouse). On line four, you should enter your name, your social security number, and your address, including the city, town, or post office, state, and ZIP code.  Also, specify the most convenient phone number to call you, if necessary.

step 3 enter the information about yourself - filling out an irs form 8857
Add the Same Info about Your Spouse

On line five, you would have to enter the name of your spouse, indicated in this request, and all the other information you know about him or her.

step 4 add the same info about your spouse - filling out an irs form 8857
Describe Your Marital Status and Education Level

First, specify the current official marital status between you and the person you have indicated above. If your situation changed after the specified tax period, you should add the confirming documents (for example, it may be a death certificate).

Then define your education level at that period; further explanations are possible here.

step 5 describe your marital status and education level - filling out an irs form 8857
Report Domestic Violence Cases or Health Problems

Here, you may add any information about the abuse or violence; whether it has happened during the tax period, you want to get relief. Your health condition at present or some years ago is a fundamental reason to be considered too. If you are afraid to write something in this form but feel it essential, point it out, and the revenue service authorities will contact you.

step 6 report domestic violence cases or health problems - filling out an irs form 8857
Answer Some Questions on Your Joint Return

Part III is devoted to your financial activities and the tax returns you prepared and submitted to the service. On lines 11 and 12, you should honestly answer whether you actually signed your joint financial declaration together with your spouse, and especially if it happened on your free consent (explain your answers, if necessary).

step 7 answer some questions on your joint return - filling out an irs form 8857
Define Your Involvement in the Family’s Financial Issues

Lines 13-15 are to identify your role in the preparation of tax returns and your knowledge about any incorrect information or hidden income of the other part. Fill in the appropriate boxes.

step 8 define your involvement in the family’s financial issues - filling out an irs form 8857
Indicate the Transfers of Property (if any)

In the case, you or your spouse has ever transferred any property or other valuable objects to each other, your relief requirement may be rejected.

On lines 20 and 21, you should describe all your property, including money and various movable and immovable objects you possess at present.

step 9 indicate the transfers of property (if any) - filling out an irs form 8857
Provide Other Information You Consider Important

In Part IV, you may add any details or additions that may be important for deciding on your liability exemption.

step 10 provide other information you consider important - filling out an irs form 8857
Sign and Date the Form

Hopefully, you have filled the form to the end and checked it with the help of our built-in software. All you have to do is to sign and date it, as well as to leave a completed copy for yourself. If any paid person helped you to prepare this application, he should sign it too.