Today TaxMama® hears from Sue, who overcame a big problem. To make a long story short, Sue suddenly discovered, purely by accident, that she’d only been paying one of the two taxes required by her city for her business. They hit her with about $12,000 worth of back taxes, penalties and interest. Uh oh. What now?
Dear Sue and Friends,
First of all, this problem illustrates the critical importance of knowing your industry before you start a business. If you’re not familiar with all the taxes and regulations, either do the research or hire someone to do it for you. But get it right from the start, or it could be expensive.
If you suddenly find out that you missed important filings and tax payments, you can try begging for forgivenenss. In this case, TaxMama® suggested:
Contact the Treasurer’s office and ask them for information about their appeals process.
One argument that sometimes works is – “Penalties are designed to ensure compliance – not to punish. I have been trying to comply – and will continue to meet my obligations.
Can you please waive this set of penalties and I’ll be good forevermore?”
Sue did exactly that, in her own way. In fact, as sweet as she is, she probably figured this out on her own. The result?
“Just this a.m. I finally moved up the chain far enough that they waived all penalties, late fees and interest. I agreed to pay their admin fees. The Director said she understood that we were complying, and agreed that their website was constantly changing and confusing.”
The lessons here?
1) Be sweet and sincerely apologetic.
2) And ask. Nothing happens if you don’t ask!
And remember, you can find answers to all kinds of questions about getting penalties waived and other tax issues, free. Where? Where else? At www.TaxMama.com.[Note: If you were subscribed to the e-mailed version of TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the join TaxMama.com link – it’s free!]
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