Atlanta CPA Advises on Filing of Back Taxes & Old Income Tax Returns

November 7, 2017/in Blog /by John Dillard

The filing of old back tax returns often “freezes” taxpayers who become too scared to address their open monies. Below is an example of an inquiry from a taxpayer seeking advice on filing of past unfiled income tax returns:

I’m looking for help filing back taxes (last 5 years) and I am desperate to get my tax situation in order. I need to find help I can afford!

If I’m too small a customer do you know of another resource for help with this issue?

Thank you very much,

Below is my response to their inquiry:

I would suggest using us to get your back taxes filed. On the contact page of my website I have a checklist you can use to pull your information together to file the returns. In the interim I have recapped a bit about our business philosophy and services.

When addressing unfiled tax returns and to file back taxes, frequently the options look bleak, as often they are. However there is good news for those who are desirous to look “outside the box” in looking to solve your IRS tax problems. Knowing the ins and outs of varying programs will do much to help you know what is in your best interest. After you have filed you back taxes and got all of your returns filed with the IRS it is then time to turn your attention toward the successful payment of your open IRS obligations.

IRS Installment plans are essentially long range, but are frequently the most convenient way to solve an IRS tax bill short term. However this option is frequently the worst option as interest and penalties continue to be assessed thus ensuring that you continue to owe even more additional monies rather than less. Form 9465 is used by taxpayers with the IRS to make an Installment Agreement Request to set up a monthly payment plan. If at all possible it is recommended that before you set up an installment plan, you look to other options available such as a loan from a bank.

Also great care should be taken to be a forward thinker when doing your cash flow and to plan long term to ensure that you will be able to fulfill the financial commitment you make in a Formal IRS Installment Plan. For example, if you owe taxes for the 2008 tax year and have not yet filed your 2009 returns and have not yet done adequate tax planning for 2010, setting up an Installment Plan with the IRS might be one of the worst things you can do. Care should be exercised to both, get all of your back/old income tax returns filed first and then to evaluate your 2010 taxable income to ensure that you will have the taxes and monies to pay all of the tax years in question. Failing to do so can be especially problematic as one of the rules of being on an Installment Plan is that you have to stay current on all of your filings and payments for the duration of the payment period, or the IRS will void the Installment Agreement and reinstate collection efforts. Considering all of these options allows you to have a much less problematic agreement and avoid unnecessary headaches, professional fees, and additional fines, penalties and interest.

To learn more about IRS Representation issues see:

Getting to the other side of an IRS Audit

Understanding How IRS Audits are Selected
Knowing how IRS audits are selected is the first step to discovering how to overcome the emotional and financial distress that normally occurs as part of the audit process. Lifting this veil will help keep you on an even keel in learning how to deal with the IRS audit.

What to Do When the IRS Notice Arrives
Don’t start the IRS Audit process in fear, discover how you can better prepare yourself so that you are not surprised at the audit process and its ultimate results. By seeing through to the other side you can best ready yourself to close your audit with no adjustments and no additional monies due.

Are You Receiving Threatening Letters from the IRS?

November 3, 2017/in Blog /by John Dillard

Is the IRS Breathing Down Your Back?

Are You Receiving Threatening Letters from the IRS?

Has the IRS Sent You a Garnishment, a Tax Lien or Notice of Seizure?

Do you have unpaid income taxes, payroll taxes or sales taxes?

Are IRS Tax Problems

Breaking Your Back?

Got Old Back Taxes That Need to Be Filed ASAP?

Have You Gotten Behind on Your Business Taxes?

Facing IRS Tax Representation Issues?

Need Help in the Filing of Your Old Tax Returns?Get your Tax Year Off on the RIGHT Foot.

The below is a sample letter we might receive off of our web site. Be Sure You Find and Work With a CPA in Your Area who is well experienced in tax representation issues to Ensure you Pay ONLY Your Lowest Legal Tax and Avoid Costly Delays and Tax Penalties?

Hi John: I hope you enjoyed the holidays.

I have a business here in Duluth/Gwinnett that I am dealing with that has not filed returns in over 10 years. I need to figure out how to advise them on this. Can we just file for the last 3 and hope the IRS does not pitch a fit? The records prior to that are not well maintained and it will be difficult to pull it together for the prior years.

Is this something that you can do? If so, can you give me a ball park on the cost of doing this. Also, they will need book keeping services to help to straighten out their accounting process. If this is something that you do, can you ball park for me the monthly cost of doing the accounting and returns annually? What additional information would you need for me to gather in order for you to do an assessment and make a proposal? Let me know. Thanks,

Below is our response:

Thanks very much for thinking of me. You can try just filing the latest three years but that would not be what would be best as technically the more years you have not filed for an extended time period the IRS has a harsher propensity to address. In fact the ten year statute for the IRS addressing those returns has not started until the return is either filed or assessed by the IRS so essentially the issue would remain open/unaddressed until the return is filed.

For all of our clients we work hard to guide them in addressing their bookkeeping issues working to ensure they have a simple yet very workable chart of accounts that will allow them to both file their returns and to have substantive and meaningful profit and loss statements and going forward management reporting. We have found in doing it this way we work with a client to provide a better short and long-term solution while guiding them in either hiring a bookkeeper or assist in guiding them through the process of pulling their data together.

To truly best provide a meaningful quote we would need a copy of their last return filed. Please feel free to have them PDF it to me and then for us to have a conversation about how we might best compile their data starting with the oldest return first and then working towards the most current allowing for any roll-forward issues to be correctly addressed on subsequent returns.

Fee-wise the returns themselves would depend upon the complexity of the returns and how well the bookkeeping data is compiled. Any time required to get the data ready to prepare the returns would be done at our standard hourly rates. Also at the bottom of our home page we have a tax checklist they can use to pull their tax information together. I suggest a free initial meeting where we might discuss the particulars in person.