Advice needed


D

Dannie

Was just given 7 years of taxes (1997-2003) which were not
filed. Person is separated from wife with one under 18 year
old daughter. Pays support (not court ordered) but didn't
bother to keep records. All I have are his W-2's for the 7
years and 2 slips from a casino for 2 years in which he won
over $2,000 each year. In fact one slip has a wrong social
security number for him. I have d/ld the proper 1040A's and
2 1040's for years involved with gambling.

Problems as I see them and would like your advice.

1. Wife refuses to supply him with her SS# which he needs to
put on form since he will be filing as "Married living
apart". Will a statement by him to that effect for each year
be adequate for IRS?

2. He wishes to take the Standard Deduction for Married
filing separately although his wife will not say how she
filed if indeed she did file. Should this not be documented
also as in question 1.

3. All this will lead to 7 returns showing owing or refund.
Is it not better to submit the 7 returns in one envelope at
one time? Any other way to catch IRS attention?

I assume IRS will do their thing and develop a detailed bill
(the total 7 is shaping up as pretty close to a wash, ie.
refunds & owing) that will be mailed to individual.

Is there something I am overlooking? He has an explanation
as to why he has not filed but submitting that to IRS, will
that help. He really wants to put this aside and move on
with his life although I am somewhat shocked that the IRS
has not picked up on this already. Then again we are talking
about an average of $18,000 per year, not earth shattering
in these days of inflation.

This of course will lead to the State Tax failure to file
but that is another issue.

Dan
 
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H

Helen P. OPlanick EA

Was just given 7 years of taxes (1997-2003) which were not
filed. Person is separated from wife with one under 18 year
old daughter. Pays support (not court ordered) but didn't
bother to keep records. All I have are his W-2's for the 7
years and 2 slips from a casino for 2 years in which he won
over $2,000 each year. In fact one slip has a wrong social
security number for him. I have d/ld the proper 1040A's and
2 1040's for years involved with gambling.

Problems as I see them and would like your advice.

1. Wife refuses to supply him with her SS# which he needs to
put on form since he will be filing as "Married living
apart". Will a statement by him to that effect for each year
be adequate for IRS?
Yes. Since the IRS will use MFS for him anyway if they do
the returns.
2. He wishes to take the Standard Deduction for Married
filing separately although his wife will not say how she
filed if indeed she did file. Should this not be documented
also as in question 1.
As above.
3. All this will lead to 7 returns showing owing or refund.
Is it not better to submit the 7 returns in one envelope at
one time? Any other way to catch IRS attention?
NEVER, ever send more than one return in an envelope. Each
one goes separately.
I assume IRS will do their thing and develop a detailed bill
(the total 7 is shaping up as pretty close to a wash, ie.
refunds & owing) that will be mailed to individual.
Remember, he does not get refunds for any periods before
2000 and if he owes, he owes.

Helen, EA in PA
Member of The Tax Gang
Director, National Assoication of Enrolled Agents
Immediate Past President, PA Society of Enrolled Agents
 
H

Harlan Lunsford

Dannie said:
Was just given 7 years of taxes (1997-2003) which were not
filed. Person is separated from wife with one under 18 year
old daughter. Pays support (not court ordered) but didn't
bother to keep records. All I have are his W-2's for the 7
years and 2 slips from a casino for 2 years in which he won
over $2,000 each year. In fact one slip has a wrong social
security number for him. I have d/ld the proper 1040A's and
2 1040's for years involved with gambling.

Problems as I see them and would like your advice.

1. Wife refuses to supply him with her SS# which he needs to
put on form since he will be filing as "Married living
apart". Will a statement by him to that effect for each year
be adequate for IRS?
In the ssn block for spouse, simply put "unknown". nothing more.
2. He wishes to take the Standard Deduction for Married
filing separately although his wife will not say how she
filed if indeed she did file. Should this not be documented
also as in question 1.
Taking the standard is the only thing he can do. If IRS
wants to raise the problem later, let them, but I seriously
doubt they'll even notice.
3. All this will lead to 7 returns showing owing or refund.
Is it not better to submit the 7 returns in one envelope at
one time? Any other way to catch IRS attention?
I always send all returns together with my covering letter
along with a POA of course. REgistered mail of course,
with notes for my record detailing that all returns were
sent with registered letter.
I assume IRS will do their thing and develop a detailed bill
(the total 7 is shaping up as pretty close to a wash, ie.
refunds & owing) that will be mailed to individual.
Don't count on a wash. If he had refunds for first three
years, these won't wash with the last three years.
Is there something I am overlooking? He has an explanation
as to why he has not filed but submitting that to IRS, will
that help.
Never complain; never explain. Don't do a bit of good to
call attention to him. It's enough that he's getting with
the program, and unless IRS is already on notice no one
there should even raise an eyebrow.
He really wants to put this aside and move on
with his life although I am somewhat shocked that the IRS
has not picked up on this already. Then again we are talking
about an average of $18,000 per year, not earth shattering
in these days of inflation.

This of course will lead to the State Tax failure to file
but that is another issue.
Good luck, Dan!

Cheer$,
Harlan Lunsford, EA n LA
 
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P

Phoebe Roberts, EA

Dannie said:
3. All this will lead to 7 returns showing owing or refund.
Is it not better to submit the 7 returns in one envelope at
one time? Any other way to catch IRS attention?
If you don't like Helen or Harlan's advice, file the balance
due separately from the refund returns, and wait until one
batch has finished processing (you've paid the tax and any
interest and penalty, or you've gotten the refund checks)
before sending the other. It stops you from having the
interesting conversation "Your <open year> refund was
applied back to <closed year>, and you can't get a refund on
a closed year," despite the amount being applied back being
significantly more than the tax, interest, and penalty due.
If you do end up having that conversation, the Taxpayer
Advocate can shake your money loose.

Phoebe :)
 

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