Haven't filed in years, have no $$ to pay or file with

[MSummers]

In Pennsylvania
I have not filed and federal, state, or local returns in over ten years since my last accountant died
In this time, I've been mostly self-employed and have been futilely struggling to catch up with filings and taxes. I currently have a retail store and haven't paid collected sales taxes in at least four years. I've probably accumulated at least 100-200 thousand in total taxes due to state and federal PLUS penalties and have NO way of paying them.

The problem gets worse with each passing day and year. I am constantly fighting to somehow get enough money to catch up and file, but not be forced out of my home. The money owed grows and puts more and more pressure on me, but have not had much luck at all. Of course I hope and push to somehow make a miracle happen through a boost in business and some speculation in options markets, but my luck has been sparse.

The other issue I've been racing with is my health. I have severe pain caused by arthritis in every major joint, but most predominantly in my spine, which causes varying levels of chronic pain, usually making a restful night's sleep of more than a few hours a rare event. I suffer from extreme fatigue as a result, making keeping up with anything a real task. I also am having other health issues which I am afraid to get checked out due to the possibility of creating extra costs, preventing me from working at all, losing my health insurance, amd then creating a pre-existing condition.

This health problems and education level limits my options as far as working somewhere else. I get bouts of severe headaches, intense pain and fatigue. I also have some internal issues which I prefer not to get into. I'm about fifty years of age. I presently work limited hours at the store

Like many others, we've seen our home purchased in 2007 drop sharply in value. We put 20% down with proceeds from last home sale, but probably now have very little, if any, equity. The IRS did collect on some tax liens from the sale as well, so have no current liens. The home is probably not worth much more than 200k, about what's owed. And due to business being so poor. we are always fighting day to day just to pay our bills.

Yes, this pressure has brought about depression and too often leaves thoughts of suicide- particularly late at night when I can't sleep- and have my wife collect on my life insurance, but could never do that to my children. Additionally, I am always optimistic and still enjoy life too much. Other than a very small amount of emergency cash, I have no money to pay an attorney or accountant. I have no other source of income other than whatever we manage to sell that day at the store. There's probably about 50k wholesale of inventory. The current economic climate would make this a difficult sell, as I've tried to liquidate on my own. We were never able to sell the business when things were better a few years ago due to not having anything filed, so had to ride the downturn.

I may have a few thousand in collectibles gathered from yard sales over the years, but even that market is severely depressed, so they'd sell at firesale prices as well. I have nobody to borrow from nor would I even consider, as I couldn't pay them back without a miracle. I already have about 20k in credit card debt.

The bottom line is there is no way I can pay anyone what they would want to help me to even begin to get this matter resolved. That would be several thousand dollars minimum of money that is needed just to get by. Nor can I possibly come up with the owed sales taxes, which are my biggest concern-let alone Fed taxes. That might be about 100k alone. This leaves me in a constant state of major angst, making my situation that much worse. I fear getting arrested at any time for fraud and theft. Every time someone walks in the store, I'm waiting to see if someone is coming in to serve me papers or worse. That collected 6% ended up mixed in with our sales and ultimately used just to pay our regular expenses. And we are obviously behind in local municipal filings and taxes as well.

I'm aware of an offer in compromise, but with no regular income, no meaningful remaining savings, or no certainty if I'll even be able to work much longer, that isn't an option.

I would like to somehow get 2008 filed in time and work our way back
If anyone has any suggestions, I would greatly appreciate your help

[LdiJ]

I almost don't know what to say to you.

I don't recommend starting with 2008 unless you are absolutely certain that the state and the IRS are not already on the hunt for you.

I also have no idea how you have managed to avoid the sales tax people, because they are normally quite rabid about collecting sales tax.

IF your business records are in very good order and if you are willing to wait until after April 15th, you may be able to find a local tax professional that would take on the task at a very discounted price. I would recommend checking out local, independent offices (not branches of major national chains) that are open all year.

I also would recommend that you go back just 7 years, rather than 10.

Otherwise, your only other option would be to attempt to do the returns yourself. Past year forms and instructions are available at irs.gov However, in all reality the cost of printing out the instructions for each year will probably be high.

[MSummers]

You started out sharing my feeling...being lost in an endless and impossible maze that haunts me every waking AND sleeping moment. I wake up from dreams of being chased and finding myself perched at tops of roofs and buildings with no way back down. It seems as if every option is a potential Pandora's box, opening up the door to even greater encumbrances

As far as the state goes, they are not "on the hunt" as far as I know. They are probably not aware the business still exists due to no filings. We relocated and during that time, the sales tax license had lapsed and never been renewed. Something else that has been put off. Which brings up the problem of having been collecting without a valid license. I figured we have to, as it will eventually have to be paid and would be odd if we didn't.

I did register a corporation(has been a sole proprietorship) with a similar name in 2007, hoping to transfer everything to that, but never did again due to the costs and requirements for additional filings. I have recently gotten requests to file a status report or notice of dissolution within 15 days. I haven't.

Haven't heard much from the IRS. They did send something to the attorney who handled our closing to be forwarded to me regarded 2007 returns. SO I do expect that to be followed up in time.

I have received numerous letters from municipality requesting past due filings, and do fear them abruptly shutting me down at any time and exacerbating the problem by cutting off our only revenue source and laying claim to our inventory.

Once I file 2008, I had better be prepared to explain everything leading up to it. That's always been a problem. Due to the complexity and timeframe, I'm concerned the problem has gotten out of control. Someone suggested filing for three years and see what the IRS asks for after that. I have all the forms for 08 I may need. I also had been collecting the forms for most years in anticipation of filing. But the expense and worry over becoming an indentured servant while trying to lead any semblance of a normal life while confronting health issues has always made me put it off again and again.

I think you could say I'm physically handicapped and disabled, but not by legal standards. I can walk and run and function and appear healthy, but inside I'm often in agonizing pain and usually feel very fatigued. This is mostly from the arthritis in my spine, but the other joints like hips and shoulders are major contributors to the feeling as well

Financially, we're living day to day, with both vehicles being over 10 years old, having over 130k miles on them and ready for the scrapyard. My wife takes one kid to school with her vehicle and I take mine to work. There is no other option and we depend on both. Wife works part time, making enough to cover groceries with a little to spare.

March mortgage payment hasn't been paid yet, but should be shortly. I do currently have good credit, with a FICO in mid 700's. Despite this, we can't refi our 2007 7% mortgage because I did a stated income loan. So there's great incentive to file and show income to qualify for refi at sub 5%, for no other reason than to send the difference to tax collector rather than mortgage company. But again with business and health as it is, I am continually wondering if we'll even be able to pay anything next month.

My other incentive to file is to potentially collect disability after I pay three consecutive years taxes, though I've never been one to want or ask for any govt assistance. I often wonder what effect ridding myself of this burden would have on my general well being. Stress and sleepless nights are definitely not helping. So the best govt assistance would probably be to allow me to start from square one with some sort of reasonable compromise. I do genuinely feel a duty and obligation to be a contributing citizen and a certain embarrassment in not filing, despite all the waste being handed out.

I'm not trying to avoid or evade, I just don't have the financial resources to properly file and get caught up without literally paying in blood. I made financial mistakes, got overwhelmed, fell behind, and I guess like the banks, I need a bailout and a fresh start. The relief of not having this cloud over my head would be unimaginable. I have never indulged in extravagance. I worked in the store for six month stints with zero days off hardly seeing my kids. I worked 120 hour weeks. And I have nothing to show but debt, failing health, and extreme physical and mental pain

Thanks again for your input. I hope somehow someway to connect with someone who can steer me in the right direction

[LdiJ]

The best way to connect with someone that can truly help you is to contact local tax offices that are open year round, and make an appointment for a consult. The consultation may not cost you anything (if it takes place after April 15th).

If your records are in good order, (everything properly catagorized and totalled by catagory) so that the returns can be done with a minimum of "fuss" you can find someone decent who would possible handle 7 years for not too much money. Many of us are willing to do a little partially pro bono in the off season.

At a minimum I would go back at least 3 years. I would NOT try to just file for 2008 and hope for the best. I would also do as much of the work as possible, yourself (as far as catagorizing and adding things up).

[MSummers]

I will be doing just that. At this point, trying to avoid another year's worth of penalties at the risk of potentially creating more problems due to errors is not seeming to make sense. But I realize I must get the monkey off my back and move on and commit to getting the work done and paid for.

We do have the categorized totals for he business.

Thanks again for your generosity.