Innocent Spouse Allocation

[Corduroy Frog]

The IRS offers to do this, but most clients want to have some idear what is going to happen, during their appointment before insisting on it.

The appropriate items of revenue and expense are allocated.  Rates in use, before proration, are married filing separately.  Which, if any, of the following are true?

1. In absence of clear identification, items of expense are allocated in proportion to respective incomes.
2. Even though using married filing separately, Large items such as EIC can be allocated even though MFS does not support EIC.

Thanks in advance.

[Lion EA]

If you're using MFS, why do you need the innocent spouse form?

[Corduroy Frog]

Hi Lion - we are filing MFJ, but the IRS claims the allocation will be prorated downward after a quasi-MFS separation.

[Lion EA]

Yes, the IRS allocates so the innocent spouse can receive her/his ratio of the refund.

[kathyc2]

Are you actually filing innocent spouse as opposed to injured spouse?  

For injured spouse the tax is calculated MFJ.  8379 is then completed so the that the injured spouse (the one without past debts that refund would be held to pay) still gets the refund they personally would have been entitled to.