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View Full Version : Is there a tax reprieve for a bankrupt recovering addict who cannot pay backtaxes?


joyjoy
Nov 30, 2008, 10:06 AM
A recovering drug addict lost everything due to his addiction and his church is helping him gain back his life. However, he had not filed his income tax return for at least 3 years. That means that he owes IRS some money but he has no way of paying them off. He will not be able to successfully turn over a new leaf if this burden persistently weighs him down. What can he do? Does the IRS help out in such a case or does he have to ask the court to stop them from running after him? Does he have to file for bankruptcy?

twinkiedooter
Nov 30, 2008, 11:38 AM
The recovering addict excuse is not recognized by the IRS. Sorry. The taxes are owed and need to be paid. Remember, DARE means Drugs Are Really Expensive in more ways than one.

MukatA
Dec 1, 2008, 04:07 AM
1. If you meet the filing requirement, you must file all the old tax return.
2. Then you can try for settlement with IRS if you do not have any assets (offer of compromise) or go for installment agreement.

AtlantaTaxExpert
Dec 1, 2008, 09:52 AM
First things first: He needs to file his tax returns. If he worked a normal job and had money withheld from his pay, it is likely that he owes NO taxes, but rather is due a refund. Assuming we are talking aout tax years 2005, 2006 and 2007, he can still file for each of these years and get his refund.

Now, if he DOES owe back taxes, he can set up a payment plan and pay it off, just like a car loan.

If the debt owed is just too much for him to pay, an offer in compromise is the next step. He should get an enrolled agent (EA)to help him file this offer in compromise. Perhaps the church can get free help with this from one of their parishoners who is an EA or CPA.