Making Payments to The IRS

[Terry D EA]

Some of you responded to me in another post regarding a client making payments on known balance due to the IRS. The replies said to make the payments now to avoid any additional penalties and interest. I agree and this was generally very good advice. Nevertheless, each circumstance is different and sometimes may require a different approach. 

Background, client is young and has never filed any tax returns. Client worked for a company as an employee and was paid under the table to avoid payroll taxes; etc. This took place for 6 years. Client wants to pay the tax he would owe on the wages paid to him as cash payments. (Because this is a public forum, I'm leaving out details)

My first step was to file form SS8 for a determination which is a slam dunk in my opinion. I have not ever met a waiter, server or whatever they maybe called, working in a restaurant that was or could be classified as a sub-contractor. Again, leaving out details. Anyway, the tax payments.

For filing the tax returns, form 8919 is used and must include the firm's EIN to e-file. Did everything possible to obtain the EIN and could not get it so per the instructions the word UNKNOWN was inserted for the EIN. Thus, negating any possibility of e-filing.

Client owes for 2019, 2020, & 2022. TY 2017 and 2018 were filed by mail with a very small refund that will be forfeited. However, the IRS still does not have record of the client existing. Because of this, no payments could be made using DirectPay, EFTPS or through the ID.Me account. 

The only solution is to include payment with the respective returns and mail it in. Scary but the only way. The penalties charged are already at the maximum 25% so no additional penalties should be assessed. The interest could be adjusted. But the argument of the post mark date as the filing date could apply here if needed. 

Most people who would end up in this situation would take the cash and run. I think this speaks volumes for this young person desiring to do the right thing regardless of the cost. When they first came to me for help, I could only tell them what they had to do by law. Kudos to this person. 

 

Edited December 15, 2023 by Terry D EA
grammatical error

[Lee B]

Assuming that he no longer works for this company, the first thing I would have him do is file a Wage & Hour complaint with the Bureau of Labor.

[Terry D EA]

No longer works there. Yes, we are looking into that and the whistle blower form as well. As far as I can tell, there are a number of other folks that could be affected by this. 

[Catherine]

Kudos to this young person, indeed. I hope the IRS comes down hard on the employer, too.

In this case, paper-filed returns with check payment(s) enclosed is indeed the only way to file. 

[JohnH]

When mailing, I assume you're going to use Certified Mail with Return Receipt.  That way you'll have proof of mailing and the tracking system allows you to verify when the envelope is received by IRS. Of course, there's no way to know how long they will take to actually process it. 

[Terry D EA]

JohnH,

Yes, I always use certified mail with return receipt. Just know that is not 100% fool proof or guarantee of anything. On October 26, 2023, I mailed a 941-X to the IRS. November 9th, it ended up back in my mailbox, green card attached, and without any explanation. i took it back to the post office and no one there could figure out what was wrong or why it was returned. They decided to send it again. As of this moment, the location of that envelope is unknown. I had to resend it and I keep praying the first one comes back to me. If that form hits the IRS twice, who knows what will happen. 

[Gail in Virginia]

Lately, I have not been impressed with the postal services handling of return receipt mail.  Twice I have received mail addressed to me with return receipt cards attached that was just placed in my box with the return receipt cards attached.  I could sign or not sign as i chose as no one attempted to get a signature from me.  In both cases, I did sign the cards and drop them back in the mail, but I have to admit in at least one instance it was several days after I received the certified letter that I got around to dealing with it.  This is not the way that is supposed to work.  

[Lee B]

Yeah, our Postal Service is really struggling right now. Large deficits. The mail carriers are swamped with Amazon (Last Mile Delivery) packages.

 

 

 

[Catherine]

It's not just recently; the no-green-card-return has been going on for years, and it's why I stopped recommending it. I was told by a mail carrier who delivered to a local office that the mail is delivered in bags, and it's anyone's guess as to whether those green cards are ever even seen, let alone signed (or stamped) and returned they way they're supposed to be. And our local office is a small one, not one of the big centers.

[JohnH]

Yes, the performance of the post office is less than stellar. But when it must be mailed, Certified Mail is still the gold standard for proof of mailing. Just be sure to keep the receipt. And online tracking is a good backup for those times when the green card never makes it back.