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FiveStarLaw
FiveStarLaw, Attorney
Category: Business Law
Satisfied Customers: 36555
Experience:  25 years of experience helping people like you.
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I am in a very scary situation. I am a sole proprietor and

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I am in a very scary situation. I am a sole proprietor and have not filed taxes yet for my business because I won't be able to pay for the taxes generated from the revenue. All of my revenues have been drained from paying bills. I am struggling financially. Usually I use Turbotax to do my taxes, but because there is high risk of me being audited, I am considering getting an accountant or tax attorney in case the IRS comes after me. Also, my ledger doesn't seem to matching up. Please tell me what the best course of action should be.
Submitted: 3 years ago.
Category: Business Law
Expert:  FiveStarLaw replied 3 years ago.
Hello,

So sorry to hear of your difficult situation. If my answer is not clear to you, I encourage you to ask me for clarification by using the reply button.

Having your tax return professionally prepared by a CPA seems to be your wisest course of action. The CPA can present your information in a format that may have a less likely chance of being audited and may be able to lessen your tax liability. If you are audited, you will want to retain a tax attorney as well as your CPA that prepared the return


Please let me know if you have any questions concerning my answer.
Customer: replied 3 years ago.

WebLaw,

 

I appreciate your response. So what you are saying is that I should only get a tax attorney if I get audited. For the time being, I should get a CPA to help me with my taxes. By the way, can you give me a ballpark as to what I can expect to pay a CPA for the services. Do you think it will cost more than $500 to do my taxes? (I am a private tutor)

Expert:  FiveStarLaw replied 3 years ago.
Typically a tax attorney would not prepare the actual tax returns- Tax attorneys do more with the issues of tax law then preparing the tax filings. I cannot guess how much a CPA would charge but it would typically be much less than a tax attorney. Regardless of the cost of the CPA, it would typically be significantly less costly than an IRS audit and fines
Customer: replied 3 years ago.

I have one more question. Let's assume I do get audited. Could they put me in jail if I cannot pay the fees in full?

Expert:  FiveStarLaw replied 3 years ago.
NO.

Although incarceration may be a penalty for tax fraud, it is not a penalty for inability to pay. The most important thing to distinguish between fraud and inability to pay is filing a tax return
FiveStarLaw, Attorney
Category: Business Law
Satisfied Customers: 36555
Experience: 25 years of experience helping people like you.
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