Today TaxMama hears from Kris in the TaxQuips Forum, with a long story. Let me summarize. Her boyfriend is behind on filing personal and payroll tax returns. He tried to get help from an accountant who may have overcharged him, and did not complete the work because he couldn’t pay the bill. They want to get married, but don’t want to jeopardize her assets. You can read the details here.
This is such a tough situation. And it will take a while to clear up – even when the tax returns are filed. It’s odd that the accountant kept submitting monthly bills for quarterly tax returns – and never prepared the annual payroll tax returns. Did your boyfriend pay in the taxes that were due quarterly? If he did, he’s not in as much trouble as you might think.
First of all, IRS can help him prepare and file the annual payroll tax returns. If he needs to prepare and issue W-2s, well, he might need help for that. But you can get prior year forms on the IRS website for free. They are pretty simple to prepare, but you need to type them or print them out. AND send them to people, in case they never got them.
As to all the unfiled years? Perhaps you can help him work through that yourself. I found a website that would let him file his prior year IRS tax returns for free. He would just have to pay for the state tax return. Not a bad deal. If he doesn’t have complete books, help him come up with a reasonable estimate for his income and expenses and include a statement that explains how he arrived at his estimates.
Now, as to marriage? If there is a huge balance due and he doesn’t want to jeopardize your assets? Just have an attorney draw up a pre- AND a post-nuptial agreement, keeping your assets separate. Maintain separate bank accounts and credit cards at all times. At least until all this is resolved.
You don’t need to put your life on hold because of his prior bad luck. But… with all that misfortune, are you sure you want to rush into this? Take your time a bit. If you really love each other now, you will still love each other in two years.
And remember, you can find answers to all kinds of questions about filing late, free. Where? Where else? At www.TaxMama.com.