Haven't filed since 2000 owe $24k

[OweWay2MuchTax]

What is the name of your state (only U.S. law)? I currently live in Louisiana, this stems back to when I lived in California.

I just got a letter from the IRS yesterday saying for the 2001 and 2002 years alone (with penalties no interest) I owe nearly $24,000. I haven't filed since 2000 because I couldn't afford to pay what I owed back then so now I am in way over my head. I make around $26,000 a year so I will not be able to pay anywhere near what I will be required to pay. I don't want to spend money on a tax attorney if it won't help me out, and I don't want to get scammed by an online company, however I don't know enough to go to the IRS and get this lowered or anything myself and don't want to miss an opportunity to save thousands either. Thank you to anyone who can help.

 

[davew128]

If you don't address it, things will get worse...payroll garnishments, property seizures, and bank levies. If you're not going to hire a professional, you'll still need to deal with the IRS, and as unpallatable as that sounds, it's better than doing nothing at all.

 

[OweWay2MuchTax]

Tax relief

Are there any companies out there that are legit though? Or is it better to go through a tax attorney?

 

[antrc170]

It's not nearly as scary to deal with the IRS as you think. You can set up a payment plan with the IRS without any legal assistance at all. Go to Internal Revenue Service. Go to the "Individuals" tap on top. On the left side of the page is a "Online Payment Agreement". It is a fill in the blank style form where you disclose your income, ssn, etc. It allows you to set up a payment that you can afford without bankrupting you. You can also call 1-800-829-1040 for additional help from the IRS.

 

[TinkerBelleLuvr]

Were you self-employed? sold stocks? what? It may be a case that you don't owe as much as you think. But, you'll never know until you actually do the tax returns. You can go to a reputable tax or accounting firm; don't do a we-are-only-open-during-tax-season place.

 

[cbg]

Water under the bridge now, but if you can't afford what you owe, it's better to take care of it at the time (partial payments, payment plans, etc.) than to just ignore it. The IRS is usually pretty reasonable as long as you make an effort; it's when you do nothing at all that they tend to be annoyed.

 

[davew128]

It's not nearly as scary to deal with the IRS as you think. You can set up a payment plan with the IRS without any legal assistance at all. Go to Internal Revenue Service. Go to the "Individuals" tap on top. On the left side of the page is a "Online Payment Agreement". It is a fill in the blank style form where you disclose your income, ssn, etc. It allows you to set up a payment that you can afford without bankrupting you. You can also call 1-800-829-1040 for additional help from the IRS.

Where to start?

1) No, it's not automatic the outstanding balance is too high.
2) I seriously doubt OP makes enough to afford payments the IRS would want manually.
3) The number you provided is for tax help not collections.
4) The IRS is going to be VERY harsh in dealing with him because of the age of the debt.

 

[antrc170]

Where to start?

1) No, it's not automatic the outstanding balance is too high.
2) I seriously doubt OP makes enough to afford payments the IRS would want manually.
3) The number you provided is for tax help not collections.
4) The IRS is going to be VERY harsh in dealing with him because of the age of the debt.

1. The balance for combined taxes/penalties is $25K, the OP stated that he owed "nearly $24K". Even over $25K may still be eligible.
2. The IRS doesn't demand a certain payment percentage. The taxpayer submits to the IRS what they are willing to pay, and when the payment is due.
3. The number is a number for tax help who can then direct the call to the proper division.
4. The IRS is not going to be "VERY harsh" in dealing with him because the IRS knows you can't get blood from a turnip.

You need to do some more research before replying next time. Here is a helpful link for you to do some studying: IRS Offers Several Tax Payment Options

 

[tranquility]

davew128 gets his knowledge from his job and not from a web link.

The IRS (depending on when the returns were filed) is nearing collection limits on some of the taxes. They are not going to deal, they are going to take stuff. Also, while they often accept the full amount (with penalties and interest) paid in less than five years as a plan, here they will not. Again, with collection limits.

It is astonishing how much the IRS thinks a person can live on as compared to what the person thinks they can live on.

The OP is lucky they are not talking criminal for so long without filing. This is not going to be a "call the number on the website" resolution to the problem. This is a serious issue which can affect the OPs credit, income and ownership rights for a long time.

 

[davew128]

1. The balance for combined taxes/penalties is $25K, the OP stated that he owed "nearly $24K". Even over $25K may still be eligible.

NO revenue officer would accept an installment agreement on anything here that doesn't demonstrate in the ability to pay in real documented dollars, and in a time frame that doesn't jeopardize the statute on collections and the OPA will not work on debts that old unless he can pay in a short time frame.

2. The IRS doesn't demand a certain payment percentage. The taxpayer submits to the IRS what they are willing to pay, and when the payment is due.

The IRS can garnish wages and levy bank accounts if the taxpayer doesn't cooperate.

3. The number is a number for tax help who can then direct the call to the proper division.

The number for collections is also on the IRS website and likely on all correspondence he is receiving.

4. The IRS is not going to be "VERY harsh" in dealing with him because the IRS knows you can't get blood from a turnip.

taxpayer has not filed his returns in nearly 10 years. Until and unless he files those returns AND files a 433 with full document disclosure, he runs the risk of having most everything he owns taken. That's a fact and I've seen it happen.

You need to do some more research before replying next time. Here is a helpful link for you to do some studying: IRS Offers Several Tax Payment Options

I have 3 open collection cases right now including someone who runs the risk of having his corporate veil pierced for running personal expenses through his corporate bank account. I've forgotten more about IRS collections than you'll ever know.

 

[xylene]

No offense to expert advisers, but perhaps asset preservation should not be the top priority concern for dealing with this tax debt.

The IRS will be harsh, but so. What is the OP going to have stroke. He needs to deal with this, before it gets worse. To get right.

I guess my point is this - how much hard assets and flush bank accounts can someone have when they've been averaging a gross income of 26 grand since 2000?

 

[davew128]

No offense to expert advisers, but perhaps asset preservation should not be the top priority concern for dealing with this tax debt.

The IRS will be harsh, but so. What is the OP going to have stroke. He needs to deal with this, before it gets worse. To get right.

I guess my point is this - how much hard assets and flush bank accounts can someone have when they've been averaging a gross income of 26 grand since 2000?

Well since the IRS can garnish 70% of his net paycheck and make it basically impossible to have a bank account by issuing levies on a monthly basis, OP needs to play ball. OP doesn't play ball, that's what will happen. By at least communicating and COOPERATING something can be worked out. Neither party may get what they want, but not getting an optimal result is better than a doomsday result.

Keeping in mind all the unfiled returns....we don't know if tax will be owed or not for those years. Filing those returns WILL BE a requirement, make no mistake. Revenue officers aren't just about collecting money but also about being in compliance....and being in compliance is a contractual requirement of any agreement the IRS signs, be it installment agreement or OIC. Failure to maintain compliance voids the agreement. That's a BAD thing.

 

[OweWay2MuchTax]

Note from Original Poster

Just to further add to the help I am receiving (if this changes anything)
1) Just got my last 2 years W2's Made $22k each year so I was Over-estimating
2) Don't own a car or a home so don't have anything to be seized to speak of
3) My bank account is under 1,000 and can gladly go straight to them to help this out
4) I currently wait tables so all my income is in cash, I don't have anything to garnish as my 2.13 an hour goes straight to the IRS anyways

Don't know if any of this helps or hurts my case.... But I figure it might get some better situational advice by providing you more info...

Thanks to EVERYONE so far, and to everyone who will reply to this post as well...

 

[tranquility]

You need to go to a tax professional to file all your returns and make an OIC based on doubts as to collectability. It's not just a simple thing to do and it would be well worth it to see someone who has experience.

 

[OweWay2MuchTax]

By tax professional are we talking attorney or one of the online tax help places.. this gets kind of back to my original problem of not knowing whether tax masters or any such places are legitimate or not... I don't want to throw more money away I'm in too deep already..