Finance Questions? Ask a Financial Expert for Answers ASAP
Hello and welcome. My name is Megan and I will be happy to assist you today
How are you doing?
When your bank closed, did another bank take its place? Financial institutions are required to keep records for at least 7 years.
I also find it very odd that Paychex doesn't keep records for at least that long...
One of the banks, M&I just closed, no bank took its place. That is the bank we used in 2007 and 2008. Washington Mutual, was the bank we used in 2005-2006. They merged with Chase, but because it has been more than 7 years, they have no records of our accounts.
You don't have anywhere else you can look for records?
Paychex should keep data for at least 7 years as well, I would think - because they have to keep track of W-2 information
Do you have copies of the 941 forms that were filed?
And they should have records from November 2006 forward. So in worst case scenario you should only have to worry about the taxes due from Jan 2006 to November 2006.
Employment tax records should be kept for 4 years, according to the IRS website. However, they are saying that you did not even file a return so they can still assess tax
My best advice to you would be to hire a local accountant to assist you in this matter, because it's not going to be easy to fight the IRS on this one. The Taxpayer advocate is typically only used when you are having trouble with the IRS itself - they would not help you prove or disprove that you paid certain expenses
I never kept the copies.....once we closed the business, and moved out of state, we just got rid of everything. When the IRS agent requested info, it came straight from Paychex and the banks.
A few hundred dollars for a tax professional is better than thousands of dollars of payroll taxes
Do you have any more questions?
Yes, what exactly can a tax professional help me with? I no longer have proof.
Well, they can look at what you do have and maybe help you come up with a different way of proving that you paid the taxes. Do you have business logs? A checkbook register? Accounting records? Anything?
Unfortunately, the burden of proof is on the taxpayer. You can CLICK HERE to read about burden of proof.
Do you have any further questions about this matter?