New Wrinkle

[Christian]

A couple who own a farm has come to me this year. They have not filed returns for 2012, 2013, & 2014. I have completed 2012 and given it to them. They have an insurance program they participate in called Agri Business which for an annual premium pays medical expenses for them. In addition, so long as the wife is shown as an employee of the farm at a nominal salary they can deduct the insurance premium and expenses as an employee benefit on their farm return thus reducing not only their regular tax but also their social security self employment tax as well. Their problem is they did not file their W-2 for 2013 in 2014 and pay the required social security tax on the wife. I will file the one for 2014 (no problem there as it is for them an annual one time payment). They are hoping to file one for 2013 thus allowing them to deduct an employee benefit from their farm return. As I do virtually no payroll accounting I am unable to answer whether at this late date social security would accept such a late filing even with payment of a substantial late filing penalty. Can anyone address this issue ? 

[OldJack]

You can't always let a client's problem become your problem.  This client is a problem client and you may be better off without them.  Why should you try to rewrite the past when they didn't worry about writing it correct in the first place.  They probably didn't file tax returns because their tax guy didn't tell them too. LOL.  I would look at their tax situation as it is and record/prepare it like it is.  If you try to redo their facts you will just encourage them to keep doing things wrong since they think you will make it right.  You should prepare based upon the facts and just the facts.  This type of client needs to be told that it cost them to not have a professional tax preparer like you in those past years. If the client doesn't like it they can always get someone else and you would be better off.

[Jack from Ohio]

You can't always let a client's problem become your problem.  This client is a problem client and you may be better off without them.  Why should you try to rewrite the past when they didn't worry about writing it correct in the first place.  They probably didn't file tax returns because their tax guy didn't tell them too. LOL.  I would look at their tax situation as it is and record/prepare it like it is.  If you try to redo their facts you will just encourage them to keep doing things wrong since they think you will make it right.  You should prepare based upon the facts and just the facts.  This type of client needs to be told that it cost them to not have a professional tax preparer like you in those past years. If the client doesn't like it they can always get someone else and you would be better off.

Well spoken.  I agree 100%

[Cathy]

Jack took the words out of my mouth...I also agree 100%!

If you decide to keep the new client, file an extension for 2014 and make sure you get a good size deposit for the years of 2013 and 2014. I wouldn't give him an exact price for 2013 and 2014....I'd give him a broad range if they insist. Also, make sure you are paid for 2012 before you Do any other work. Charge accordingly for 2013 and 2014 as it sounds like you have the type of clients that will "play dumb" and want you to be responsible for keeping record of every payment they make to IRS which also means reviewing/answering numerous correspondence from IRS.

I've paid my dues in the past in the type of situation you have and I wouldn't even think about taking on the type of clients you have with these people. However, if this is your first of this type of client, you might want to pay your dues as experience is the best teacher.

Good luck which ever way you decide to go!

Take care,

Cathy

[kcjenkins]

A couple who own a farm has come to me this year. They have not filed returns for 2012, 2013, & 2014. I have completed 2012 and given it to them. They have an insurance program they participate in called Agri Business which for an annual premium pays medical expenses for them. In addition, so long as the wife is shown as an employee of the farm at a nominal salary they can deduct the insurance premium and expenses as an employee benefit on their farm return thus reducing not only their regular tax but also their social security self employment tax as well. Their problem is they did not file their W-2 for 2013 in 2014 and pay the required social security tax on the wife. I will file the one for 2014 (no problem there as it is for them an annual one time payment). They are hoping to file one for 2013 thus allowing them to deduct an employee benefit from their farm return. As I do virtually no payroll accounting I am unable to answer whether at this late date social security would accept such a late filing even with payment of a substantial late filing penalty. Can anyone address this issue ? 

But to answer your actual question, yes, you can file the late W-2, and don't forget, farmers file a 943, rather than a 941.    

[FreedomTaxed]

The late filing of W-2/W-3 forms doesn't seem to be severe.

 

http://www.irs.gov/instructions/iw2w3/ch01.html#d0e1889

 

What I don't know at all is the method of paying W-2 withholdings late, even years late.

[Max W]

The late filing of W-2/W-3 forms doesn't seem to be severe.

 

http://www.irs.gov/instructions/iw2w3/ch01.html#d0e1889

 

What I don't know at all is the method of paying W-2 withholdings late, even years late.

It can be done the same way as current payments.

http://www.irs.gov/uac/Where-to-File-Your-Taxes--for-Form-941

or, possibly via EFTPS.

[kcjenkins]

The late filing of W-2/W-3 forms doesn't seem to be severe.

 

http://www.irs.gov/instructions/iw2w3/ch01.html#d0e1889

 

What I don't know at all is the method of paying W-2 withholdings late, even years late.I would f

I would paper file the 943s and include a check, with the YEAR clearly stated on the check.  Don't worry about the penalties, IRS will bill for those.