Tax question

[bethann3181]

Hi all, I’m new to the board but have been a lurker for so many years, going back to The Knot and The Nest. I have a tax question for my mom and know you all are so knowledgeable and helpful.

My mom (who lives in FL) has been a W9 independent contract employee for years. She wasn’t getting her stimulus which lead me to ask questions and it was revealed that while she has been paying her quarterly federal taxes each year on time, she hasn’t filed her federal taxes since 2016. I am still picking my jaw up off the floor. She said there’s been no letters, reminders or late notices. She doesn’t have an accountant, so I’m calling in the morning for her to get this all squared away.

My question is, does anyone know what repercussions might be involved here? She thinks she doesn’t owe much, as she’s been paying her quarterlies. I said I doubted she’d get a stimulus, or any unemployment, until this was all amended, but she said she was able to file for a stimulus on the state’s UC webpage for those who hasn’t yet paid taxes?

Any info before talking to an accountant would be helpful. Thank you!

[jwright]

She needs to get her documents in order to file those old tax returns. There is no statute of limitations on non-filing.

However, she may not be in too-bad of shape since she has been paying estimates; any penalties or interest would be on a balance due. If she paid the amount due or even overpaid she wouldn't owe or could even be due a refund. But if she does owe money, then it will come with interest, failure to pay penalties, and failure to file penalties. She needs to get the returns in processing to stop the clock on those.

Make sure she reports all expenses related to her income since she is self employed.

I know that the stimulus won't be issued if she hasn't filed, I'm not sure on unemployment as I haven't kept up with all the latest.

[puppylove64]

I think there is a 3 year statute of limitations on refunds. So if she was due a refund in 2016, she can try rolling it over to 2017, but they won’t pay it out.