2 Years, No Taxes Filed -- How Big'a Poopstorm?

[HeartBroke]

Hi helpful oracle ...

Okay, so here's the skinny: I haven't filed taxes in two years and, really, it's because I haven't made any money. As I understand it, you have to earn some threshhold amount --$5000?-- to be required to file.

Anyway, just wanting to explore this before I file Wednesday. Any thoughts and/or sage experience appreciated!

--HeartBroke (if you're wondering: $79,000 in medical bills)

[AMISLANDER]

I just filed this year...since 2001

When I had originally thought about filing bankruptcy, about a year ago (I knew sooner or later, it would happen, new laws just speeded it up for me), in one of my first consultations, I had to explain that not only did I have $50K in cc debt from 2001...but I hadn't filed with the IRS since then either. I wasn't working but I was getting alimony...which ended last November. I was told by the attorney that before filing bankruptcy, take care of the taxes. I had a debt of about $20k due to the alimony money. So I had to take it out of a SEP plan. Not what I wanted to do, but necessary. I did not want to be on a payment plan with Uncle Sam and be under constant scrutinization.

So, when I went this summer to start my paperwork, taxes were complete.
I would imagine it would be better if your taxes were paid prior to filing. But someone else may have been through it in your same situation and be able to tell you better.

[StaciMM]

I'm not sure what the #'s are, but if you're employed and earn less than a certain amount per year, you don't have to file. If you're self employed though, that # is alot lower-$400 I think. I don't know how that impacts filing BK though.

Do you have w2's or something, showing your low income?

[bezoar]

If you had a regular job (i.e., W-2's issued), then the limit is around $7,000 before you have to file. Staci is correct - if you worked for yourself, you have to file if you made over $400.

You can probably get away with filing your tax returns during your case. Not necessarily paying them - but filing them. If you don't file, the trustee will probably continue your case for a few weeks until you get 'em filed if you haven't by the time of your 341. I'd have them ready for him though - they're so overwhelmed right now, the trustee said (during GF's mtg) if he asks for something, you'd better get it to him when he wants it...or else...

[HeartBroke]

Thanks all!

Okay ... it seems the safest thing to do is to put this on my "To Do" list -- right after I finish Schedule F, G, H, I and J. Uh ... before Thursday.

That's no problem. I'll just snort a bottle of crushed-up ephedrin.

[Lightning]

Whether or not you need to file income tax returns depends on 3 factors:
- Filing status
- Age
- Income

Either look at the IRS's web page or consult with an account or tax attorney to determine whether or not you need to file.

[HeartBroke]

Single, 37 ... income right now, or past two years?

Right now on target for maybe $8000.00 this year.

Prior two years have been ... er ... well, $898 I remember taking in last year, while shelling out about 11k on the business ...

I think the year before was worse.

Does that help any?

[Lightning]

You have to do the leg work. Maybe someone else here will do it for you, but I won't. You have to figure out those three factors for the years you didn't file and then use IRS info or the advice of a tax attorney or adviser to determine if you need to file.

[sunshine08]

I am sorry, but I can't imagine filing taxes, especially when a business is involved. IRS is going to get its money, and its interest, and its penalties, and whatever else it wants. Just an observation.

[HHM]

Well regardless of whether you need to file...assuming you don't, you will need to be ready to supply the bankruptcy trustee with an affidavit explaining why you haven't filed taxes.