Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

I had a friend prepare my taxes in 2009 and he completely

Customer Question
I had a "friend" prepare...
I had a "friend" prepare my taxes in 2009 and he completely botched it. He used Turbotax but named me as the preparer. Last week the IRS sent me a letter telling me that I owe them $5,860 for that year because he entered some information incorrectly (the amount of tax withheld and my taxable wages by thousands of dollars). I'm not sure what to do now. I don't have the money. Should I go to a tax preparer and have someone review the return to make sure I owe this much money or should I just bite the bullet and set up a payment plan? I already have a payment plan set up for last years taxes which I am up to date on but I don't think that I can afford two payment plans.
Submitted: 6 years ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 2 minutes by:
6/3/2011
Tax Professional: Jax Tax, Tax Attorney replied 6 years ago
Jax Tax
Jax Tax, Tax Attorney
Category: Tax
Satisfied Customers: 1,408
Experience: JD, LL.M in Business and Taxation, IRS Enrolled Agent. Expert in Business and Tax Transactions
Verified

Jax Tax : Welcome to JA. I am here to assit you. You have a few options.
Customer :

ok

Jax Tax :

If you add the $5800 to the amount you owe, what would the total be?

Jax Tax :

Did you pay your "friend" to do the return?

Customer :

about $10,000 for 2009 and 2010. Yes I paid him $50.

Jax Tax :

First. If you do not like this person, you can turn them into the director of professional responsibility for preparing a return for a fee and not indicating himself as the preparer and not completing the return correctly.

Jax Tax :

You are saying him put more for federal tax withholding than you actually had?

Customer :

Yes. He indicated that the tax withheld was $4,157 when it was only $457 and also that my taxable wages were $39,500 when they were actually $51,399.

Jax Tax :

What was the source of the taxable wages being increased. Did he not have all of your income docs?

Customer :

I could turn him in but I don't have a receipt to prove that I paid him. I do have an email though. What would that do for me if I turned him in.

Customer :

He must have just typed the wrong numbers in for some reason. I only had one W-2 and only one source of income.

Jax Tax :

Do you have the w-2 with you? What does line 1 say? Do you have a copy of the return?

Customer :

I have a copy of the return but not my W-2. I never got the W-2 back from him, which was a mistake on my part

Customer :

But I'm pretty sure that it says $51,399 because what he wrote, $39,500 sounds way too low. I know I made more than that.

Jax Tax :

What lines on page 1 of the return are filled out?

Customer :

1, 6a, 7 and 22

Customer :

36 and 37

Customer :

are you still there?

Jax Tax :

Sorry. Another expert had me locked out.

Jax Tax :

What do lines 38-43 have on them. The exact amount?

Customer :

38 - $38,565

Customer :

40a 14,904

Customer :

41 - 23,661

Customer :

42 - 3,650

Customer :

43 - 20,011

Jax Tax :

Um. Did you pay health insurance or contribute to an IRA/401k in 2009?

Customer :

I did pay health insurance. No IRA

Jax Tax :

How much per month?

Jax Tax :

Do you own your home/pay a mortgage?

Customer :

im not sure the exact amount right now. it comes out of my paycheck. i think about $150 a month.

Customer :

no, i rent

Jax Tax :

What lines on the Sch A are filled out. This would be the source of line 40a $14904

Customer :

5 a - $7000, 8 - $125, 9 - $7125 17 - $700, 18 - $4,100 19 - 4800 21 - $3,500 22 - 250 24 - 3750 26 - 771 27 - 2979 29 - 14904

Jax Tax :

Are you paying a State installment agreement? Did you have $7000 in state taxes withheld from your check?

Jax Tax :

Can you call IRS at 800 829 7650 and ask for a income transcript for 2009? Have a fax number ready or get the income and tax withheld information verbally and log back on?

Jax Tax :

Get all income reported to you, the amount, and the tax withheld.

Customer :

I am not paying a state installment agreement for 2009, but i did pay one for 2008 during 2009. I had less than $7000 in state taxes withheld from my check. This is because I am a server and only get paid $4 and hour and first my health insurance comes out of my check, whatever is left over goes to taxes but I always end up owing at the end of the year.

Customer :

Ok. I can do that. But I have to go to work now. Is it possible to resume this on Monday?

Jax Tax :

Anytime this weekend. I get notified on my phone.

Jax Tax :

I just want to ensure I have all the info so I can help.

Customer :

Alright. So, when I log in it will notify you to log in as well, right? I want to get you and not someone else. I will get the info tomorrow and try to log back in on Sunday.

Customer :

Thank you so much for your help so far.

Jax Tax : You got it. To answer your question, you will have to include the new debt in the current payment. You can request a penalty abatement form 843, but do not know for what quite yet. Based on what you have given me so far, I am not sure.
Jax Tax :

Good day Sir. Were you able to obtain a copy of your w2?

Customer :

I got the information from the IRS that you suggested I get, the income and tax withheld for 2009.

Jax Tax :

Welcome back.

Jax Tax :

What is the amount shown as withheld/

Customer :

Income withheld was $457 and wages were $51,399. Like I said before, the guy who did my taxes entered the wrong information for these, that's why I owe more money.

Jax Tax :

Ok. So you have two options.

Customer :

Withheld: $457, Wages:$51,399

Customer :

sorry, that was an accident

Customer :

ok what are they?

Customer :

you still there?

Jax Tax :

First, you need to sign the CP 2000 and return it to the IRS so that you can set up a new payment to cover both debts.

Jax Tax :

You should include with the singed CP 2000 a form 9465 to request the payment plan. Make sure the total debt will be paid in 60 months. I would divide the total by 55 to ensure the interest is included.

Jax Tax :

So you options.

Jax Tax :

1. File a form 843 to request the "accuracy related penalty" be abated based on the preparer's mistake. This may be difficult since the preparer did not sign the return.

Jax Tax :

2. File suit against the preparer for all associate penalty and interest. A demand letter may do it if you state you intent to disclose the fact that they did not sign the return as is required by federal law.

Jax Tax :

At the end of the day, you need to change your withholding so this does not happen in the future. Once the total debt exceeds $25K it gets much more serious. You so not want this to happen as one step is the filing of tax liens. This will effect you ability to get loans and your credit score.

Jax Tax :

As far as the 843 request goes, you could take the blame on your self stating clerical errors.

Customer :

Ok. So if I report it as the preparer's mistake or my mistake then I may be able to get some of the penalties taken off?

Customer :

but I will still owe about 5,860 still?

Jax Tax :

Yes, you will owe the money, and yes, you can have the penalties reduced. The best option is to pay the balance in full since the IRS does charge about 5% interest rate compounding daily. A simple interest loan would be much better.

Jax Tax :

The 843 form can be used to request the penalty abatement.

Jax Tax :

The only other option if you do not want to pay the tax is to complete IRS form 433F

Jax Tax :

The IRS will use this form to make a determination as to your financial ability to pay. They can accept a $0 monthly payment if your financial circumstances support it.

Jax Tax :

You first want to change your withholdings since they are used on the 433F as an expense only if they are being withheld, which ultimately helps you not owe in the future and lower the current payment amount.

Customer :

But I only get paid $4 an hour, the money from my paycheck goes directly to health insurance and the rest to taxes. I never receive a paycheck, only tips. So, the withholding is as high as it can be.

Jax Tax :

OK. So the $51K from last year was a different job?

Jax Tax :

The 433F may help you out.

Customer :

no, its the same one, but that's mostly tips that i receive nightly, not from a check

Customer :

I only have 5 days for me to set up something with the IRS. Should I first do the 843 form, or should I request an extension?

Jax Tax :

I see. You are probably better off just sending the 9465. At $50K a year, the payment will probably be less.

Jax Tax :

Send the CP 2000 and 9465 first. Once the payment is set up, then send the 843.

Customer :

ok

Customer :

Is it possible for me to refile my 2009 tax return accurately to insure that I received all the proper deductions and that I actually owe $5860 more?

Jax Tax :

You can, but if the only change is the withholding, then it will not make any difference. The IRS has already corrected that issue. Use form 1040X to amend the return.

Ask Your Own Tax Question
Ask Jax Tax Your Own Question
Jax Tax
Jax Tax
Jax Tax, Tax Attorney
Category: Tax
Satisfied Customers: 1,408
1,408 Satisfied Customers
Experience: JD, LL.M in Business and Taxation, IRS Enrolled Agent. Expert in Business and Tax Transactions

Jax Tax is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

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.WMatteson, 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.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, 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.

OrvilleHesperia, 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!!!!

AlexLos 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.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
Lev, I am preparing federal unfiled tax returns for a client
Good morning Lev, I am preparing federal unfiled tax returns for a client of mine. I am also ready to finalize the 2014 tax return and there is an NOL created on his return. The client has already fil… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Lane, I've read that taxes need to be prepared in the basis
Hi Lane, I've read that taxes need to be prepared in the basis they're kept. I have a client that is a cash basis tax payer for the IRS, but an accrual basis tax payer for Florida sales tax. I also he… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Is a tax return less likely to be audited if it's prepared
Is a tax return less likely to be audited if it's prepared by a CPA or simply a tax person? Secondly, our Rotary Club is a 401 C for we have a 401 c 3 Foundation the question is can individual members… read more
socrateaser
socrateaser
1,031 satisfied customers
What are the benefits of getting an accountant vs. preparing
What are the benefits of getting an accountant vs. preparing your taxes through TurboTax? In the past year we got married and bought a house.… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
I need to prepare a non- withholding or reduce withholding
I need to prepare a non- withholding or reduce withholding certificate so my client can sign before transferring the tax to the IRS under FIRPA.My client and his brother owns an apartment for 500k 50%… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
I need help with preparing a tax return and I may need to
Hi I need help with preparing a tax return and I may need to file form 3520 as well. Please let me know if you can assist.… read more
taxmanrog
taxmanrog
Master\u0027s Degree
698 satisfied customers
My tax preparer is with Liberty Tax, and filed incorrect
Hi. My tax preparer is with Liberty Tax, and filed incorrect returns without my knowledge or significantly … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
723 satisfied customers
If I hire a tax preparer to help me this 2018 tax season,
If I hire a tax preparer to help me this 2018 tax season, would it be possible to pay them a base hourly wage plus bonus' if the bonus' is based on a percentage of the fees collected for each return.E… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
723 satisfied customers
I have a NJ estate tax return to prepare for a decedent in
I have a NJ estate tax return to prepare for a decedent in NJ. The brokerage statement has an account with the decedent and a trustee set up for her grandson under a U/W/O . Are these assets included … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
723 satisfied customers
I am preparing a corporate tax return. The company is a
I am preparing a corporate tax return. The company is a payroll company based in NJ but almost all of the clients are in NYC. Is the income generated from NY clients require a NY S corporate tax retur… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
A Form 1065 partnership return is being prepared for a
A Form 1065 partnership return is being prepared for a partnership whose General Partner is a single member LLC. In the Analysis of Net Income (Loss) section at the top of page 5, is the LLC's portion… read more
taxmanrog
taxmanrog
Master\u0027s Degree
698 satisfied customers
Second opinion] I used an on line tax preparer, and they
Second opinion] I used an on line tax preparer, and they sent me my tax return. The tax return had an error now the IRS wants me to pay for that error when it's the pa … read more
taxmanrog
taxmanrog
Master\u0027s Degree
698 satisfied customers
I used an on line tax preparer, and they sent me my tax
I used an on line tax preparer, and they sent me my tax return. The tax return had an error now the IRS wants me to pay for that error when it's the pa … read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
Does an IRS agent qualified to prepare capital gain taxes, I
Does an IRS agent qualified to prepare capital gain taxes … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
723 satisfied customers
I am preparing a partnership tax return for 2016. The
I am preparing a partnership tax return for 2016. The partnership holds commercial rental property. one of the partners, 50%owner, passed away in April 2016 and left his interest to his spouse. i woul… read more
PDtax
PDtax
Owner
Master\u0027s Degree
1 satisfied customers
If our tax preparer files for an extension, will we get
If our tax preparer files for an extension, will we get charged with interest and penalies … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
I don't know if you can help me on prepare a tax return that
Hi Barbara, I don't know if you can help me on prepare a tax return that have a 1031 exchange… read more
James Daloisio
James Daloisio
Attorney
Doctoral Degree
56 satisfied customers
An IRS enrolled agent prepared our taxes and didn't report
An IRS enrolled agent prepared our taxes and didn't report all of our income for 2015 and now we will have taxes due and will owe penalties and interest. Do we have any recourse in this matter? … read more
Matthew Breecher
Matthew Breecher
President
MBA (Graduate Legal Studies)
285 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x