Spouses who file joint federal tax returns generally are both liable for the tax owed. But joint filers may be eligible for innocent spouse relief. In a new case, the U.S. Tax Court ruled that a wife wasn’t entitled to relief related to foreign earned income exclusions reported on her joint tax return. The court ruled the spouse failed to establish that she didn’t have knowledge of the foreign income exclusions attributed to her husband’s employment. Indeed, the college-educated spouse had prior work and military experiences and should have known whether her husband was in fact abroad for at least the requisite number of days to be eligible for the exclusions. (TC Memo 2023-101)
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