How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Jon Andrews Your Own Question
Jon Andrews
Jon Andrews, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 3118
Experience:  I deal with all levels of tax planning and controversy - from the ordinary to the complex.
4750
Type Your Tax Question Here...
Jon Andrews is online now
A new question is answered every 9 seconds

Cant pay tax liabilty and am in the process of getting SSI.

Customer Question

I can’t pay my federal or state tax liability (17,000 combined, from the sale of a house) My income dropped when alimony ended and I cannot work because I have become disabled, have no income and no savings at all. I have applied for SSI, but it will be months before I hear anything. What can I do?
Submitted: 11 years ago.
Category: Tax
Expert:  R. Greg Paszkiewicz replied 11 years ago.
First, I would make sure you actually owed that much, if you haven't had a professional do the return I would see one to figure out if you could save some money. If you actually do owe the money you could work out a payment plan but based on what you are saying about your future income it sounds like you need to an offer in compromise to see if the tax authorities will settle for a smaller amount that you are able to actually pay. How did you arrive at owing 17K anyway?
R. Greg Paszkiewicz, Enrolled Agent
Category: Tax
Satisfied Customers: 357
Experience: 9 years preparing tax returns - Marietta, GA
R. Greg Paszkiewicz and 2 other Tax Specialists are ready to help you
Customer: replied 11 years ago.
Reply to R. Greg Paszkiewicz's Post: How did I arrive there? <laughing< How long do you have? I had two houses sold last year. I had bought one before selling the other (at the advice of a socalled business advisor) and ended up paying two mortgages for almost two years. The first one didn't sell for tht long because of a downturn here in real estate, and it was a very unusual house that took a special family. There was a fierce market at the time. I ended up selling them both last year...one I hadn't lived in so it wasn't my primary residence, and one that WAS my primary. I netted about 70,000 on the sale of the first one. I had 39,000 in alimony (which was actually a property settlement with my ex, concerning a business had run for more than twenty years.) Anyway, the 70, 000 plus the alimony put me in a higher tax bracket. Now, the 70,000 went directly to my mother to repay her for the loan of the downpayment. At no time (and this is undoubtedly my fault) did I realize what a large tax there would be, and even now, my tax guy told me he should have set me up with quarterlies last year but didn't.In the meantime, (are you still with me here?!?!?) I became too disabled to work and had to quit last October. To top it all off, my alimony ended. So now I'm sitting here, waiting for disability to be approved, with no income, no savings because I gave it all to my mother, and a $17,000 combined tax liability. I also have an adult son who is developmentally delayed and lives in a Goodwill home. His housing is paid by SSI etc, but all of his pocket mony has come from me. There is no involvement at all with his father, so there is no help for him from that quarter. I also have twin 21 year olds, who have been quite the drain on the economy here!

My first thought was to file for an extension, but I feel like I should have another person look at it. He also mentioned that I could get a payment plan and just pay a mininal amount every month for .....probably the rest of my life!!! I haven't heard of an offer in compromise....what are the criteria for that? What are the chances of that working for me? How much might they settle for? I'd appreciate any help you can give me.....how do I sign you back on for another question???? I can afford at least another payment....maybe even go as high as $10!!! <grin> Please be in touch...I feel like the compromise situation might have a chance at working. Thank you very much.
Customer: replied 11 years ago.
I'm not sure you have gotten this...I'm afraid I didn't send it correctly...I wasn't asked for my CC number....Please let me know!
Customer: replied 11 years ago.
Reply to Jon Andrews's Post: Wow. That's very interesting. I did pay her back (I still owe her more, too) and can get a letter from her, I'm sure. Is there anything else I would need to provide as documentation? I did, in fact, sell the second one (the primary residence for that year) because I became disabled and unable to work and support it. Would this qualify for an 'unforeseen circumstances exclusion?) The previous winter cost me almost $6000 (yes, you read that right) to HEAT!!! This is Maine, and it was a big, old farmhouse. I knew I couldn't keep in another year, especially when my alimony stopped February 21, 2005, so I sold it as soon as I could after I realized that, as well as that I was so ill as to have to quit working...within three months, blessedly. What that meant, however, was that, within about 4 months, between October and February, my income both from my job and from my alimony stopped. I now have zero income, have applied for disability and am living on the kindness of my mother. I have rented a little three room place all on one floor to accomodate my disability but I don't know if I can stay here: if I don't get disability for a number of months, I don't know what I'll do. The prospects of my income rising in the next few years are remote.

I'd be interested in your thoughts further...
Expert:  Jon Andrews replied 11 years ago.

Your "basis" in the house that you sold would be the amount that you paid as a down payment plus the amount of the original mortgage. When you sold it, your "net sales price" would be the selling price minus commissions and other selling costs. You should only be paying tax on the gain which is the difference between the "net sales price" and your "basis". If your mother loaned you the money, or for that matter "gave" you the money, it still counts as part of your basis.


I would definitely recommend that you have at least one other professional examine that return before you submit it. If the original preparer did a good job, they won't mind. If they did not do a good job, you need someone who will.


[email protected] 
Jon Andrews, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 3118
Experience: I deal with all levels of tax planning and controversy - from the ordinary to the complex.
Jon Andrews and 2 other Tax Specialists are ready to help you
Customer: replied 11 years ago.
The tax preparer was very strong in insisting that I get *should* a 'second opinion'. He has no problem with it.

My mother gave me the entire amount for the downpayment; she bought the house outright, (financially) I was owner and made payments to her. The house was priced at 165,000 and that is the amount she gave me. I had to take a second mortage so when I sold it, I had that to 'officially' pay off. That was for $100,000. So that balance was deducted from the proceeds, and left me with the $70,000. (Those figures are not exact, but you get the picture.)

Does all that have any bearing on amounts of exclusion, or anything at all? Let me know what other information you might need!!! Thanks for your incredibly speedy response. I'll be here for several more hours, if you recieve this message tonight.

Again, thanks.
Customer: replied 11 years ago.
Reply to Jon Andrews's Post: Hey!! I think I accepted this answer too soon, I had sent another reply and intended to pay you! I'm so confused! I DO want to talk some more and I DO want to pay you! I sent a payment for $15 a few minutes ago! Did you get my response about the payment from my mother?
Expert:  Jon Andrews replied 11 years ago.

I did and I sent you a private message in response so that you don't have to pay any more for that answer.


Please check your "private messenger" inbox.


jon

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Previous | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    577
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    577
    10 years experience
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    1245
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3882
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/TA/TaxRobin/2013-8-28_16186_femalebusinessprofessionalbinderhand11038485.64x64.jpg Robin D.'s Avatar

    Robin D.

    Senior Tax Advisor 4

    Satisfied Customers:

    11072
    15years with H & R Block. Divisional leader, Instructor
  • http://ww2.justanswer.com/uploads/YI/yirtual/2015-3-12_43754_egan.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    8621
    Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2884
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/FA/fastfile/2011-12-15_23139_Klein2011small.64x64.jpg R. Klein, EA's Avatar

    R. Klein, EA

    Enrolled Agent

    Satisfied Customers:

    1837
    Over 20 Years experience