Not reported taxes in years

[MrPink]

Alright, so I figure all the true tax nerds/gurus etc.. are really busy right now, but am going to post this anyway...

A friend (lets call him Ted) of mine has not reported taxes in years. Ted has been working various construction jobs and has been paid under the table. However, Ted has not been saving for retirement (and can't work construction forever) and since he has not reported taxable income in years am assuming that he won't be able to claim social security.

What would be the proper way to fix the situation or what would do to pull yourself out of this hole?

I think you would have to come clean with the IRS, but wonder what the ramifications would be (lets say he owns 50k in back taxes)...

 

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[Diane Kennedy]

Let me get this straight - you figure the best way to get a response is to be insulting?

 

[hakrjak]

I think people like this usually drink themselves to death by age 50, or end up in jail or die an early death in some other tragic manner. They don't generally need to worry about retirement

- Hakrjak :smx4:

 

[PEERless]

Eh... "nerd" can be a positive term? I dunno. Don't let the wording ruin the question. I'd be interested to hear this answer too!

Is there a way to have a voluntary audit to play catch up for bad behavior? Or is a there a point where the evader is so indictable it would be best to stay under the radar until he dies?

 

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[CarrieW]

id call one f those tax settlement guys.

but federal taxes and social security are totally different animals. just because he squares with the irs he still needs to square with ss.

nerd/geek doesnt have the same meaning as it used to before. look at the geek squad. people will now define themselves as nerds or geeks as a description not an insult.

 

[PEERless]

Good idea, though, if they can do it for a fee, you can do it for free. Might not be the way to go at the $50K mark.

 

[CarrieW]

not always...

I have found at least in my experience, sometimes its necessary to have a professional that knows the language and the nuiances of the law to be on your side.

when I applied for social security disability I got turned down on my first application. (ss turns down 75% of legitamite claims the first round and up to 50% on first appeal their stats)

when I went up for appeal I had a lawyer. sure I could have done it myself but I doubt I would have won. when we walked into the hearing room she started talking in law numbers and codes. I have no idea what she said to the judge. but whatever it was it worked.

also when I called to try to negotiate with my credit cards they said no negotations no rate changes. I tried several times and got turned down each and every time. but those people at the credit counseling places can do it. cause they know the language and have a professional relationship with them.

sometimes a professional can open doors that are otherwise locked to the average joe.

 

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[PEERless]

Ha. I agree with that. I have a "team" of trusted pros too. I'm just saying I wouldn't call the first 800-number that pops up on the TV.

 

[GoldenEggs]

I knew someone who does this on a regular basis. The subject of taxes came up during a cash flow game and this one player told us he doesn't pay his taxes. Well, he pays them every ten years and just pays the penalties. He said it was no big deal. I was completely boggled. I don't play cash flow with him anymore so I don't know the details of how he paid his taxes.

 

[carlhuber]

Let me get this straight - you actually think the country will be able to afford social security when Ted retires? LOL! I'm 27 and am banking on ZERO "big brother" funding. Ted's been living under the radar decently so far - what has he been doing with his money? Saving and/or investing it, or wasting it away?

Not that I want this to turn into a discussion of whether or not any person is worth caring for ( every person is worth caring for ) I'm just saying why is it anyone else's concern and/or why is it a surprise.

I'm not a fan of lying. I'd ask a CPA (I can recommend a very good one who did my taxes) for professional advice. But if you want to get him back on the books for what is arguably an unconstitutional tax; do it right.

 

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[MrPink]

Wow. I didn't mean the word 'nerd' to be insulting.

The reason that Ted does not have money is due to his wife not working and staying home to take care of their five kids.

Mr. Pink

 

[Eric]

Wow. I didn't mean the word 'nerd' to be insulting.

The reason that Ted does not have money is due to his wife not working and staying home to take care of their five kids.

Mr. Pink

That reminds me of a Joe Rogan joke.

"Im in the store and some dude walks up to me and is like.."

Guy: Dude, you see those sneekers that you are wearing? The guys who made those get paid like .50/hr.

Joe: Uhhh... they should probably quit. Sounds to me, like they're getting f---ed. However, I NEED a pair of sneakers, and I don't know how to MAKE sneakers, what to do, what to do? They're working right? They aren't slaves or anything? You should tell them to ask for more money

Guy: Hey man, you're an insensitive f---! They have families.

Joe: Why would you have a family, when you make .50/hr? Kids are f---ing expensive dude, aren't you paying attention?

 

[PEERless]

WOW! Insensitive joke, but true. It is not my (taxpayer's) fault that Ted didn't pay taxes OR save.

Tell him to get a tax attorney, but don't expect any sympathy from responsible citizens.

 

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[MrPink]

The thing that bothers me about this whole situation is that Ted's kids are having a tough time paying for college. (currently, they are taking out loans through myrichuncle at 15 % with a 10 percent fee) Ted has wrecked his credit, in addition, he will not file a fafsa due to not filing taxes therefore the kids are unable to get finicial aid. I don't feel that what Ted has done is right or should be helped out, but what is the best course if you Ted's child?

 

[AroundTheWorld]

DISCLAIMER: I'M A TAX IDIOT LOL

I'm not sure about the age requirement ( Diane ?) Maybe 18?

But if the kids are not being claimed as dependents on their parents tax return, (obviously they are not) then they can file their own return ~ and their own FAFSA stuff.

 

[rcardin]

My parents made sure not to claim us our senior year. Then financial aide is based off of the individual's income and not their parents.

 

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[CarrieW]

there is no recourse for his kids against him. they need to figure out how to do it themselves.

there are many many kids who go to college or trade school with no help from anyone.

when I applied I got turned down for everything cause my stepdad and mom claimed me untill I was 19. they made too much money, even tho I didnt live with them and they werent helping me, I still got turned away.

college is a privilege not a guarantee. Unless they were promised college and he reniged Id say its just tough for the kids. if they were promised help then I feel for them.

if they want to go that bad they will figure out a way to do it themselves without dads info.

 

[rcardin]

college is a privilege not a guarantee.

I wish the world of education would see and understand this. My district seems to have the belief that " All children are college bound". Yet the same people who preach this haven't been in a classroom for 20 years.

 

[andviv]

I've known lots of people that have found their way to pay for college. Get a job, work daylight, study at night. Enroll to the community college for the first two years to pay a cheaper tuition and then go to College to complete the degree.
It is tough, and it will only get tougher to pay for college as tuitions keep going up way faster than wages, so the sooner they get it done the better, if that's what they want to do. Maybe you can talk to the children to see how you can help them instead of worrying for Ted who, it seems, does not give a damn.

 

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[CarrieW]

yeah I dont get this entitlment mentality. maybe its just because I wasnt entitled to anything I didnt work for ever lol.

there was no car when I turned 16, no college fund, no wedding stash, everything I have and everything Ive done has been on my own. I wouldnt be who I am today if I had been given things just because I was born. (well it would have been nice to have a real wedding lol)

My kids are not going to be given things for nothing, whatever they get they will earn in some way.

if you get everything you want for nothing then how do you learn the value of anything?