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In the last few days I rec'd 2 emails, one from a Lee Perry titled Registered Auditor skills requested and one from Mark Barley, LLC titled CPA Services Requested. At least they give me easy clues to hit delete. As for the original post I think it would be a rare event for anyone in this business to give out that kind of info unless they have been living on a desert island the last few years with no way to charge their smart phone.

I have found the same thing time and time again. But I'm not sure it's fear that keeps them from filing. I've seen it take a couple of years to recover from the catastrophe, at which point they are so far behind they don't know where to start, and it's too overwhelming - so they never start, and the problem escalates. Case in point, an older man who had a heart attack or stroke (I don't remember, if I ever even knew; serious health issue). In the hospital for a long time, in rehab even longer, and a couple of years before he got his strength and energy back. Took one look at the stack somewhere before he was really well, and ignored it as too much to handle after that. His kids found out years later and they brought everything to me (with dad's permission). But it wasn't fear; it was just Sisyphus, facing another morning with that rock, and turning away.

As long as they are married and filing MFJ in the year of the first sale, AND they both meet all the other requirements for gain exclusion, they qualify for the full $500K exclusion. Then depending on when the second one sells, they may not be able to exclude that gain if they've already excluded a gain within the 2-year period ending on the date of that second home's sale. The parts of Pub 523 that actually cover this:

I understand you posters who want to do the "right thing," but the IRS is not going to have transcripts going back 20 years. It is a good idea to pull this client's record of account to see if perhaps a SFR was filed. If not, there is nothing you (or the IRS) can do but file the open years. I did have a client who hadn't filed in about 5 years, but in this case the IRS had 1099s to prove income and was hounding him. Believe it or not, he actually had records (receipts, check registers, mileage logs) for all those years. I have observed that serial nonfilers often have some personal catastrophe that gets in the way of their filing one year, and after that they are afraid to file. In Naveen's case, though, I believe the IRS would have come knocking if a SFR showed a balance due. Did he move a lot so notices didn't reach him?

Robin Williams once said (actually, he probably said it many times, but only once in the show I saw) that baby poo is one-half toxic waste and one-half velcro.

And that "somebody" is those of us who do pay.

I agree. And I feel this way about anybody skating on debts they owe. It's a real kick in the teeth for people who do what they are supposed to do and when they are supposed to do it. Someone pays for those who don't. Every time.