What is the name of your state? Pennsylvania
My husband and I formed an LLC in 2005, while we were unmarried. We knew (and still know) next to nothing about how to run a business. In the beginning we thought it would be good to keep copies of the receipts from our sales, and receipts for the supplies we purchased. We filed and paid our state sales taxes for the first and second quarters of 2005, and for the third quarter of 2005 we filed, but did not pay. That is as far as we have gone with our taxes.
We were married in 2006.
I'll spare you the details about what led us to be in such dire financial straits. I'll leave it at this: We were eating on less than $20 a week and paying our taxes just wasn't possible.
We never filed our federal taxes. Not our business taxes or our personal income taxes. The state called us to pay the taxes on the amount we filed for the third quarter of 2005, but eventually they stopped calling.
We have continued to keep some of our receipts for our expenses, and all of our copies of customer receipts. We have never had an employee. It is solely the two of us who do the service-based work.
I would like to get this taken care of by April 15th, so that we can start the new fiscal year fresh and legally. I know it won't be solved by then, but to start would be great. The burden of living with this is really tough.
We're still quite poor. We left our apartment and moved in with my parents. We have quite a bit of debt that we would like to get taken care of, aside from the tax debt. We can't afford to hire an accountant, we're hoping to do this on our own.
My husband's father is a lawyer, so we have free legal aid if necessary, but as we're quite embarrassed about our situation we'd prefer not to have to go to him.
My questions are as follows:
1.Once I figure out what we made each year, what is the approximate percentage of that income that would have to be paid out in taxes? We've never made more than $100k a year. Probably no more than $50k.
2.What sort of penalties are there for this type of thing?
3.I have heard of people having their wages garnished for tax repayment, but how would they garnish my wages since I am self-employed?
4.We haven't kept our personal finances separate from the business finances. Our personal account was closed for having too low a balance, and we just shifted to using the business account for everything. How would I be able to figure out what to claim as my personal income? All of the meager money we make is almost immediately spent back out. Is the business income also our personal incomes, then? Ours is a service based business, as in we perform a service and get paid x amount for that.
5.We are planning to close the business in several years, when we have saved up enough money to buy a small piece of land in Georgia. Would I be able to buy land and build a home on it while having this tax burden, or would the government seize it as an asset?
6.Does the IRS make payment arrangements based on your income? And if your income drops, do the reevaluate that amount?
I know this is a terrible situation. Any help you could offer at all would be of immense help. If there is any more information I need to provide you with, please just ask.
Thank you for taking the time to read my post.What is the name of your state (only U.S. law)?What is the name of your state (only U.S. law)?
My husband and I formed an LLC in 2005, while we were unmarried. We knew (and still know) next to nothing about how to run a business. In the beginning we thought it would be good to keep copies of the receipts from our sales, and receipts for the supplies we purchased. We filed and paid our state sales taxes for the first and second quarters of 2005, and for the third quarter of 2005 we filed, but did not pay. That is as far as we have gone with our taxes.
We were married in 2006.
I'll spare you the details about what led us to be in such dire financial straits. I'll leave it at this: We were eating on less than $20 a week and paying our taxes just wasn't possible.
We never filed our federal taxes. Not our business taxes or our personal income taxes. The state called us to pay the taxes on the amount we filed for the third quarter of 2005, but eventually they stopped calling.
We have continued to keep some of our receipts for our expenses, and all of our copies of customer receipts. We have never had an employee. It is solely the two of us who do the service-based work.
I would like to get this taken care of by April 15th, so that we can start the new fiscal year fresh and legally. I know it won't be solved by then, but to start would be great. The burden of living with this is really tough.
We're still quite poor. We left our apartment and moved in with my parents. We have quite a bit of debt that we would like to get taken care of, aside from the tax debt. We can't afford to hire an accountant, we're hoping to do this on our own.
My husband's father is a lawyer, so we have free legal aid if necessary, but as we're quite embarrassed about our situation we'd prefer not to have to go to him.
My questions are as follows:
1.Once I figure out what we made each year, what is the approximate percentage of that income that would have to be paid out in taxes? We've never made more than $100k a year. Probably no more than $50k.
2.What sort of penalties are there for this type of thing?
3.I have heard of people having their wages garnished for tax repayment, but how would they garnish my wages since I am self-employed?
4.We haven't kept our personal finances separate from the business finances. Our personal account was closed for having too low a balance, and we just shifted to using the business account for everything. How would I be able to figure out what to claim as my personal income? All of the meager money we make is almost immediately spent back out. Is the business income also our personal incomes, then? Ours is a service based business, as in we perform a service and get paid x amount for that.
5.We are planning to close the business in several years, when we have saved up enough money to buy a small piece of land in Georgia. Would I be able to buy land and build a home on it while having this tax burden, or would the government seize it as an asset?
6.Does the IRS make payment arrangements based on your income? And if your income drops, do the reevaluate that amount?
I know this is a terrible situation. Any help you could offer at all would be of immense help. If there is any more information I need to provide you with, please just ask.
Thank you for taking the time to read my post.What is the name of your state (only U.S. law)?What is the name of your state (only U.S. law)?
