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IRS and owed taxes

Old 10-24-2019, 10:23 AM
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Originally Posted by simeoncoleman View Post
Anyone ever make a mistake or have screwed up taxes then get a letter years later?

I had a debt forgiven back in 2017. I didn't ask for it to be forgiven. I just quit paying it with the idea of them restructuring the loan. I quit getting calls and letters from the lender. I find out in 2018 that the debt was forgiven.

Yesterday I get a notice from the IRS I owe a pretty good amount of money because it counted as income. This doesn't surprise me but what I'm more pissed about is I never received anything in the mail in order for me to add it to my taxes. Whatever form they send out I never got. So now I owe over 5 digits in taxes and penalties.

Has anyone ever worked with a tax attorney or those tax relief companies that are supposed to work with the IRS to lessen your debt?

Just ignore them and eventually the IRS will stop calling and sending letters and probably even write off the debt!!
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Old 10-24-2019, 10:23 AM
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Originally Posted by C3D View Post
The funniest part of this to me is that if this had happened to the OP in 2017 instead of 2018 he would not have owed any tax. That changed for TY18.
ONLY if it was on primary residence...
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Old 10-24-2019, 10:28 AM
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Hey OP, put down the keyboard and perhaps take some medication.

You've made a few mistakes in this ENTIRE process, so instead of coming on here, insulting others, and thereby making more mistakes, why don't get off the internet, consult a professional (tax preparer, attorney, etc.) in your area, and get the help you need with this matter.
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Old 10-24-2019, 10:34 AM
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Listen to this guy ^^^^^^^^^^
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Old 10-24-2019, 10:39 AM
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Originally Posted by Keith B View Post
Just ignore them and eventually the IRS will stop calling and sending letters and probably even write off the debt!!
This. ^^^^^
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Old 10-24-2019, 10:39 AM
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Originally Posted by simeoncoleman View Post
This is more fun than I thought!!

I'm not skirting anything. I asked if anyone has used a tax attorney or a tax agency to help with owed taxes. I know what I owe. I know what I will pay. I find it amusing that they want a certain amount in 30 days.
Use your tax preparer, especially if it's a CPA. Have them file and amended return and certainly pay whatever initial amount they request. If you did your own returns, then hire a real CPA.
Your tax preparer should be able to request an interview with a real IRS agent and perhaps negotiate a settlement agreement with the IRS. Expect to pay CPA for his time. Get a price estimate.
If the CPA is a dud, then find a tax attorney.

Don't panic,and avoid the usual chaff here on THT. This is a solvable problem but the most important things is to stop the IRS meter running. Best done with a meeting and setting up a payment schedule agreeable to them. You should be able to do this readily.
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Old 10-24-2019, 10:40 AM
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Originally Posted by Lorne Greene View Post
Forgiven debt is considered income by the IRS and they reported it to the IRS so they could write it off. It just took the IRS this long to get to you and now you owe penalties and interest. As for the financer company not notifying you, there is really nothing to be done on that front. More than likely you will get stuck into the fresh start program where you pay off the debt over six years.

Start off with a good CPA to review your 2017 taxes and see what he/she can do.

He couldn't pay his bills and you think he can afford a good CPA?

.
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Old 10-24-2019, 10:46 AM
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Originally Posted by Keith B View Post
Just ignore them and eventually the IRS will stop calling and sending letters and probably even write off the debt!!
this is the best advice! the bank only fought for 6 months, IRS is a little tougher so maybe only 8-10 months before they go away!
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Old 10-24-2019, 10:55 AM
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Originally Posted by Finsinchessy View Post
You can meet with an IRS agent. Explain the situation. Most likely you will have to pay the tax and interest. The penalties might get waived. You can offer what ever you are able to pay. I am assuming you cannot claim poverty. Depending on the agent I think the penalties will get waived and maybe some interest. Don't offer up info just answer questions. If you can have an attorney lined up it's a good idea. Any hint they want don't want to work with you or you are over you head, gracefully excuse yourself to make a prior engagement making a future appointment to continue. The go let that attorney handle it.

It really is about how you hit it off with the agent. If it's a honest case of not knowing the IRS should be lenient if you pay up the tax right away. If you can't do that expect to be under their thumb for 10 yrs .
The above is good perspective and advice. Be advised you will be automatically subject to federal and state audits for the next three years.

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Old 10-24-2019, 10:57 AM
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I predict when you finally get this all settled with the IRS in 3-4 years for the 2nd or 3rd time, you will wish you had just paid the damn loan.
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Old 10-24-2019, 11:04 AM
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So tax issues aside what I don't understand is how a 2nd mortgage would just be "forgiven" when they have the house as security?

Did they release the lien?

Is it because they can't foreclose since they aren't the 1st? Or would the cost be too high to foreclose?

I must be missing something and I'll admit I don't know how 2nd's work at all.
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Old 10-24-2019, 11:09 AM
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Anyone else curious to know who this lender is that just writes off mortgage debt after a few months? I’ve got my eye on a Freeman build slot...

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Old 10-24-2019, 11:12 AM
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Originally Posted by rbhankins001 View Post
So tax issues aside what I don't understand is how a 2nd mortgage would just be "forgiven" when they have the house as security?

Did they release the lien?

Is it because they can't foreclose since they aren't the 1st? Or would the cost be too high to foreclose?

I must be missing something and I'll admit I don't know how 2nd's work at all.
maybe the foreclosure part is coming? sometimes that seems to take awhile! had a guy down the road from me stop paying, he lived there for 5 years then they finally offered him like 15k to move out with out destroying the house!
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Old 10-24-2019, 11:13 AM
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I screwed up a self prepared tax return one year.
Several months later I get a letter from the IRS stating I owe a big number $$$ (for me) on taxes that weren't paid and another big number for a penalty.

I went to a good CPA, he straightened everything out and I actually got a refund.

As mentioned, seek out a good CPA.
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Old 10-24-2019, 11:15 AM
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Originally Posted by simeoncoleman View Post
It was a second mortgage that I wanted them to restructure. The banks words were " You are in good standing there isn't anything we can do for you". So I quit paying until they decided to do something for me. Then like I said, all calls and mail quit coming all within about 6 months.
Then it sounds like you're ahead. You didn't have to repay the loan and they reported it as income which is correct. So you should owe taxes on that amount as regular income. The only downside is it will show up on your credit report and make it harder to get a new mortgage.
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Old 10-24-2019, 11:17 AM
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Originally Posted by Marlin308 View Post
Anyone else curious to know who this lender is that just writes off mortgage debt after a few months? I’ve got my eye on a Freeman build slot...

I was thinking more along the lines of "hookers and blow" at least that way nothing traceable except maybe the STD
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Old 10-24-2019, 11:18 AM
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Originally Posted by rbhankins001 View Post
So tax issues aside what I don't understand is how a 2nd mortgage would just be "forgiven" when they have the house as security?

Did they release the lien?

Is it because they can't foreclose since they aren't the 1st? Or would the cost be too high to foreclose?

I must be missing something and I'll admit I don't know how 2nd's work at all.
I bet the lien is still on the house. Good luck ever selling that house. Plus he said he owes more then five firgues in taxes. Sounds like he stole a good bet of money from the bank.
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Old 10-24-2019, 11:26 AM
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Originally Posted by Fishonsc View Post
I bet the lien is still on the house. Good luck ever selling that house. Plus he said he owes more then five firgues in taxes. Sounds like he stole a good bet of money from the bank.
typically that would come out of his portion when sold, now if the profits are not there after satisfying mortgage 1, then it becomes a big issue and may hinder the sale! correct?
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Old 10-24-2019, 11:29 AM
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Originally Posted by Rolandt03 View Post
typically that would come out of his portion when sold, now if the profits are not there after satisfying mortgage 1, then it becomes a big issue and may hinder the sale! correct?
Correct.
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Old 10-24-2019, 11:32 AM
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Originally Posted by reelin in the keys View Post
I was thinking more along the lines of "hookers and blow" at least that way nothing traceable except maybe the STD
I like the way you think.

So OP...fess up. Who's the lender that forgives debt that easily?

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