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Walter made a lot of money, didn't know how to manage it, and bought a lot of toys. It's been four years since he filed taxes. Dave advises Walter to see a CPA immediately.
QUESTION: Walter in Dallas made a lot of money, didn’t know how to manage it, and bought a lot of toys. He didn’t file quarterly taxes, and it’s been four years since he filed taxes at all. He hasn’t saved any money and wants to know how to get this straightened out. Dave advises Walter to see a CPA immediately before the IRS finds him.
ANSWER: Not paying taxes is not a criminal offense. Not filing your taxes is. Dude, they’re going to give you some bracelets that connect if you don’t get this right soon. The chances of you going to jail for failure to file are dramatically lowered if you go to them—not if they come find you. Do not pass go. Do not do anything else today. When you hang up the phone with me, you run to a CPA and ask them what the procedure is for you to file your tax returns. You’ll probably go back three years or four years. Based on that, you will have to start working out a payment plan with the IRS—an installment plan—with the amount that you owe in taxes. Do not wait around another week. Don’t put this off another day. Certainly don’t put this off another year, because they will find you.
I don’t know how you got a tax lien against you. I’m confused if you didn’t file a tax return, unless they just guessed based on some of the 1099s that have been filed on you and just slapped a lien on you. If you want to remain a free man, this is not an area of your life that you can ignore.
It is a criminal offense to not file taxes. Almost 2,600 people were put in jail last year for failure to file. This is not a game. You go to them and file the returns properly, and in almost every case, you’ll be fine. But if you wait around until they find you, you could really get yourself into a mess.