I am a business owner and have not filed my taxes
I am a business owner and have not filed my taxes in almost 10 years. Secondly, all the records that I used to calculate my business income and deductions are missing. What can I do?
This is a surprisingly common situation where the first non-filed year becomes the second, and the second becomes the third year of non-filing, and the returns eventually don’t get filed.
Typically the IRS addresses the situation of unfiled tax returns with only requiring the last six years of returns to be filed.
First, you will need to gather as many of the records as you can and sort them by year. Establish a file folder to hold these records. Request bank statements for all years. Contact the IRS for what is called a wage and income transcript. Try to find any older tax returns to use as a template for the current filings. Then you need to start to build the tax returns in a good faith effort to estimate your income during each of the years in question. You need to take an honest and thorough look at how much disposable income was available to you over each of the years in question. And your standard of living. Your filed returns should reasonably represent the amount of income you made and your standard of living for the years in question.
Keep in mind that many records are available to you from the IRS that will allow you to further fill in any missing holes. Mortgage information, interest income, pension income, social security and the like.
As the returns are put together you need to review them for propriety. That means that over the time period in question they make sense. Following, the tax returns are filed together. A statement of the taxpayer’s circumstances may be attached. Furthermore, you may attach to each tax return a statement that the tax returns are filed with estimated information, in a good faith representation of your income.
Assessments will follow typically within 90 days. From the assessments, you can start the process of putting a Plan together to address the taxes.