Does anyone know of an appropriate news group for asking help about specific
problems that a tax payer may have with a bias IRS tax examiner?
========================================= MODERATOR'S COMMENT:
I cannot think of a better newsgroup than this to help you with
tax problems you might be having. Why don't you let us know the problems
you are having, remembering the answers might not be what you really want
Please keep the details of your situation as anonymous as possible, you
do not want to lose any confidentiality privileges, whatever they might
be in your situation, by disclosing confidential information to a
third-party, such as this group.
In general, you should also consider requesting a meeting with the
auditor's manager, request an appeals conference
and read Pub. 3605, "Fast Track Mediation: A Process for Prompt
Resolution of Tax Issues".
Thank you. I guess what I wanted to know is can the IRS suddenly demand in
2008 that a tax payer file his 2000 return when the IRS had never sent in
the past any notice or made any request about the old return that a taxpayer
had forgotten to file?
With other words, are there any procedures or steps of actions that the IRS
must do first (as required by the law) before demanding that a tax payer
either do what the IRS wants him/her to do in 2008 or get shot at with a
And if you have court cases to support your answer, that would be perfect.
My other question is this, can a tax payer be held liable for Social
Security taxes when the employer, for some reason, had misclassified a W-2
employee as a 1099? What is the most recent court ruling on something like
There is no statute of limitation for not filing (one good reason to
hang onto tax
returns indefinitely)--would be interesting if anyone knew of court
cases where someone
argued that it was an undue burden on the taxpayer to show proof of
filing from x number
of years ago. And what constitutes proof of filing if you didn't file
electronically or use
There is a procedure if you feel that you have received a 1099 in
error. You fill out an
SS-8 and then file Form 8919, which will calculate your half of the
employment taxes due.
The IRS will send an SS-8 to the employer and, if they respond, will
make a determination
as to employee or independent contractor.
Sorry if this has been explored before.
If the taxpayer didn't file a required 2000 return the IRS long ago would
have sought it. Initial inquiry probably would have been in the 2003-2005
broad timeframe. Had they sent an inquiry to the last address they had for
you at that time would you have received it?
As has been noted there's no legal limit to how far back they can go.
However, there is a policy statement that they will not go back more than 6
years except for extraordinary situations. You can find it at 18.104.22.168.18
of the Internal Revenue Manual
I would say that you are at least entitled to an explanation of why they're
pursuing this return now.
"Forgotten to file?" Never got-a-round-to-it or neglected
to file, maybe, but, absent a medical condition, it's
doubtful one would forget to file. Tax filing deadline is
the primary topic of conversation at most work and social
gatherings every April 15th, and there are reminders in all
the news media. Forgetting to file would be akin to
forgetting to drive at or below the posted speed limit.
It's your responsibility to voluntarily comply.
Of course the IRS can ask that you file a delinquent return.
That said, the IRS can't compel you to file. They can
charge and prosecute you criminally for failure to file.
They can secure your income information from you and from
third parties and file a return for you, assessing civil
penalties and interest on the tax due. Should they have
demanded that you file a return out of the normal six year
investigative scope? Not enough facts presented here to
make that determination. Does the demand indicate a "bias
IRS tax examiner" as stated in your original post? Probably
not. Certainly no literal "shot gun" involved here, nor is
the IRS figuratively shotgunning. Ensuring full compliance
with tax filing and paying requirements is the basis of
civil tax enforcement.
As noted by another poster, you can, at a minimum, be held
liable for the FICA and Medicare taxes which would have been
withheld had you been treated as employee. It would be
beneficial to your case if you can present documentation
that your employer ignored your objection(s) to receiving
gross rather than net paychecks in 2000.
Over in misc.taxes this poster has the same problem with his 2001 return,
that he did file and received a refund on, but has 1099 mis-reporting
I suspect there are other years of 1099 income being mis-reported.
So far you've gotten a lot of GOOD responses to your post. I would like to
add a bit and ask a question or two.
Your first post said that the IRS auditor was bias. I see nothing in your
second post to indicate any bias. Why do you believe the auditor to be
As to what steps or procedures the IRS must do first - it is likely that one
of two things have happened - EITHER
A - the IRS has sent notices that you have not received, OR
B - while investigating you for something more current they have discovered
prior year delinquencies.
In either case they are within their rights to enforce compliance for
however many years they feel is necessary. There is a policy position
within the Internal Revenue Manual that starts with NORMALLY they will not
go after more than six years or returns. But I am aware of NOTHING that
would stop them for going after 50 years of returns if they believe they are
justified in doing so.
In fact, depending on your circumstances they may actually be using you to
set an example. Make no mistake, this is NOT discrimination - especially if
you didn't file. And you'll never get them to admit openly IF they are
tying to make an example of you, but that wouldn't change it IF they were.
And let me be real clear here - I am NOT suggesting that the IRS is
attacking you personally and I'm NOT suggesting that they are trying to make
an example of you. I'm simply giving you my take on the situation based on
my 25+ years of dealing with the IRS on behalf of taxpayers.
I cannot impress upon you how important it is that you get professional help
with this matter. This is even more true IF they are trying to make an
example of you. Representing yourself is a recipe for disaster - get
professional help from someone who specializes in taxpayer representation.
As an EA I'm inclined to send you to
- the National Association
of Enrolled Agents website where you can search for a tax pro in your area.
EAs, by definition, specialize in representing taxpayer before the IRS.
However, a CPA experienced in representing taxpayers would be just as good
at this point. I would NOT engage a tax attorney just yet, until either an
EA or CPA has assessed your case. Tax attorneys have a place, but that is
usually NOT at the beginning of the process UNLESS you have reason to
believe that criminal charges may be pending.
As to whether you can be held liable for Social Security taxes - most
definately YES, in one form or another. If you were self employed you are
responsible for SE tax on your net income. If you were an employee you are
responsible for your half that should have been withheld - whether you are
responsible to the authorities or your employer is a matter for a different
discussion, but you are responsible one way or the other.
Be careful about asking for court rulings. These are very specific and
address specific cases with specific fact patterns which may or may not
match the intricacies of your situation. Not to mention that your question
is so broad that I could provide you with cites for either side - for or
against. Assessment of whether a legal ruling, or for that matter the
interpretation of The Code, Tresury Regs - whether they be perm, temp or
proposed -, Rev. Rules, Treasury Decisions, PLRs, TAMs, or whatever, are
best left to qualified professionals.
You also need to keep in mind that IF you attempt to represent yourself
everything you say or produce will become part of your file and it will be
virtually impossible for you to get professional help later on to counteract
anything that you SHOULD NOT have produced or said.
Get professional help NOW - even if it is just to help assess your
situation. Talk to someone qualified who is looking out for YOU before you
say or give anything to the authorities.
Gene E. Utterback, EA, RFC, ABA
(part of reply also snipped for brevity....)
Since OP was referring first to tax year 2000, I took it that the second
question about incorrect classification also referred to same tax year.
The form 8919 is a recent "invention", and only applies to tax years
2007 et seq. If for tax year 2006 or before use the "old" form 4137,
just like we used to.
Harlan Lunsford, EA n LA