[AustinJR]

YEah I am in a lot of trouble folks, and I have NO IDEA what to do.

1st off I am moving to Portland, so in short my GF and I of 4 year broke up. She didn't want to come with me, and she wouldn't move.

So here's the issue. The last 2 years 2004 and 2005 she has done my taxes. I gave her the money I owed, well SHE NEVER SENT IT IN! I haven't paid my taxes in 2 years now because of her. I guess it's a good thing she told me, as I was able to confirm they truly weren't paid.

I want to make this right with the IRS, I know I will be penalty for not having these paid in 2 years. If I remember correctly I owed about 800 in 2004 and 900ish in 2005. Now here is where it gets a little crazy. One top of this. I recently close out my 401K with my old company.

I had a loan outstanding which I reported as income. The loan was about 7K, and my 401K total was about 16K.

Can someome please help me understand what hell I am going to go through to make this right? I don't care what it costs, I have the money. I just want this behind me. Ugh damn sneeky ex's. I still have no idea what she did with the money:mad:

[ScottGem]

First thing is to get copies of your returns. Did the G/F sign as a preparer? If so, you can sue her for the money she never paid. Not so much to collect but to show the IRS that you did give her the money.

Next, go to the IRS, before they come after you, and explain to them what happened and ask what you need to do now. As long as you approach them, and considering the small amounts, they should be willing to work with you, maybe even waiving penalties.

As far as the 401k is concerned, you will have to add the outstanding loan balance as income and you also have to pay a 10% penalty (more bad planning, you should have paid off the loan and rolled it over to your new job, then taken a new loan out).

I would also get a proefessional preparer to help prepare your returns this year.

[AustinJR]

First thing is to get copies of your returns. Did the G/F sign as a preparer? if so, you can sue her for the money she never paid. Not so much to collect but to show the IRS that you did give her the money.

Next, go to the IRS, before they come after you, and explain to them what happened and ask what you need to do now. As long as you approach them, and considering the small amounts, they should be willing to work with you, maybe even waiving penalties.

As far as the 401k is concerned, you will have to add the outstanding loan balance as income and you also have to pay a 10% penalty (more bad planning, you should have paid off the loan and rolled it over to your new job, then taken a new loan out).

I would also get a proefessional preparer to help prepare your returns this year.

Scott,

The loan was taken out to help a family member in need, so it wasn't really bad planning. More like bad timing. I don't mind taking the hit for helping them out.

When you say contact the IRS, do I just go to the website and make a call? I guess I am just a little baffled as to what to do. It would be awesome if they wave the fee's etc. As for suing the Ex. She has bigger problems then me, so for the small amount, I am not to worried about it. She has to figure out how to live on her own now... I am not out to seek revenge, just make it right on my side.

[ScottGem]

Taking the loan wasn't bad planning, but not paying it back before accepting a distribution was.

Look in the phone book for the nearest IRS office and call for an appointment.

I'm not talking about suing for revenge. It doesn't matter if you try to collect once you get a judgement. Or whether you even pursue the judgement once you straighten things out with the IRS. The purpose of filing (in small claims court) is to show the IRS, that the non payment was not your actions.

[AtlantaTaxExpert]

Scott:

The IRS truly does not care why you failed to file.

It is ultimately your responsibility to make sure your tax return is filed correctly and on time, which is why tax preparers are not held responsible to the extent that the taxpayer is when errors are made on returns.

Don't get me wrong; the IRS does go after bad tax preparers with a separate schedule of fines and penalties. It's just that the taxpayer gets hit worse!

In my opinion, a lawsuit is probably not worth the effort, as it will have ZERO effect on his dealings with the IRS.

The IRS will probably waive the late/failure to pay fees if he comes forth and corrects the problem before the IRS gets around to him. That has been my experience.

[Fr_Chuck]

Ok, if you have not filed your taxes, that is different than just not paying them.

I believe if you did not actually file, you get a good preparer to do your taxes with penalties and the such and file. ( Even if you can't pay in full right now)
Then you can work out a payment plan with them,

If you actually filed, but just did not send in the money, yes merely contact them and work out a payment plan.

I will note if Atlanta Tax disagrees, this is his area of expertise.

[AtlantaTaxExpert]

Fr Chucks Course of Action is viable, though the preparer should prepare a cover letter asking that all penalties be waived (interest, by law, CANNOT be waived).