People who missed one year and then could not face the next
the most common version, and the easiest to fix.
01What we do
What a back taxes accountant does
A back taxes accountant brings an unfiled or unpaid position back into compliance and then deals with what is owed. Three separate jobs, usually in that order: work out which years have to be filed, prepare and file them, then reduce and resolve the balance.
The second and third parts are where a CPA for back taxes earns the fee. Most people who have not filed assume the problem is the returns. The returns are the easy part. The expensive part is that penalties have been running the whole time, that the IRS may already have filed something on your behalf, and that the deadlines for fixing both are not the same deadlines.
Nobody here is going to tell you the debt disappears. Some of it usually can be removed, and the rest can almost always be made payable. Which of those applies is a question of facts, and the facts are in the transcripts.
12+ years
serving New York City
150,000+
returns filed
50 states
covered
5 star
Google, Yelp, Thumbtack
Open
evenings and weekends
02Who we work with
Who we work with
Back tax work splits by how the gap happened.
Self employed and 1099 earners
no withholding, a balance every year, and a gap that compounds.
People who moved states or countries
a federal gap and a state gap that do not match, and often a foreign reporting question on top.
Business owners behind on payroll or sales tax
the most urgent category, because trust fund taxes reach the individual.
Estates and executors
a decedent's unfiled years, which have to be cleared before an estate can close.
People the IRS has already filed for
a balance already assessed on a return you did not prepare.
03How many years
How many years back you actually have to file
Six, usually. But that is a policy, not a statute, and the two are often confused.
Under Policy Statement 5-133, set out in the Internal Revenue Manual, the IRS normally enforces delinquent filing for six years. Going back further needs managerial approval. So somebody fifteen years behind is usually looking at six returns rather than fifteen.
What that policy does not do is close the older years. The assessment clock under section 6501 does not start until a return is filed, so an unfiled year stays open indefinitely. If the IRS has already assessed an old year, that liability is real and has to be dealt with whatever the six year policy says. Six years is the compliance answer. It is not an expiry date.
What the IRS files when you do not
If you leave a year long enough, the IRS can prepare a substitute for return under section 6020(b) using the income reported to it by employers, banks and platforms. It is not a guess, and it is not in your favor either. A substitute for return:
- contains the income reported to the IRS by employers, banks and platforms
- omits itemized deductions, credits, dependents, basis and business expenses
- allows the standard deduction, but a joint filing status requires the taxpayers' election
Filing your own return for that year can produce a lower number, and it can be done after a substitute has already been assessed. The IRS reviews it and generally adjusts the account to reflect the correct figures.
04What we file and fix
What we file and fix
The compliance half of the engagement.
Transcript retrieval
account, wage and income, and return transcripts for every open year. Wage and income transcripts generally reach back ten years, which is how a return gets built when the paperwork is long gone.
Prior year returns
federal and state, prepared on the law of the year in question rather than the current one.
Substitute for return reconsideration
an original return filed to request adjustment of what the IRS assessed, with the deductions it never had.
Business and payroll filings
unfiled 941s, 940s and NYS-45s, plus the entity returns behind them.
Foreign reporting
FBAR and Form 8938 for years that were missed, where a streamlined route may still be open.
Refund years
worth checking early, because a refund is only claimable for a limited period and an old one that lapses is gone.
05Relief and payment
Penalty relief and payment options
The resolution half, and where the number actually moves.
Failure to file and failure to pay
5 percent a month and 0.5 percent a month respectively, each capped at 25 percent. In a month where both run, the filing penalty is reduced by the payment penalty, so the combined charge is 5 percent rather than 5.5. A return more than 60 days late also carries a minimum penalty.
First time abatement
three clean prior years can buy relief for one eligible period. Where several periods are involved, it generally applies to the earliest qualifying one. It remains available for older back returns. Automatic Exemption from Penalty replaces it for eligible returns due from January 2027.
Reasonable cause penalty abatement
illness, disaster, destroyed records, or reliance on a professional where the full facts support it. It is a facts and evidence argument, and it can cover periods administrative relief cannot.
Form 843 penalty abatement
the claim used to recover penalties you have already paid.
Installment agreements
monthly payment against the federal balance, with the terms driven by what is owed and what you can document.
Offer in compromise
settlement for less than the balance where reasonable collection potential genuinely supports it. Most people who ask about this do not qualify, and we will say so.
Currently not collectible status
collection paused where paying anything would leave you unable to meet basic living expenses. The debt does not go away, but the clock keeps running.
The collection statute expiration date
the IRS generally has ten years from assessment to collect, and certain events suspend it. Where each year sits on that clock changes which option is worth taking.
06New York collects longer
New York collects for twenty years, not the federal ten
Clearing the IRS does not clear New York, and the state is the harder half more often than people expect.
Twenty years, not ten. New York can collect for twenty years, counted from the earliest date it could have filed a tax warrant rather than from when it actually filed one. The federal clock is ten years from assessment.
Unfiled years stay open for assessment. New York may assess at any time where no return was filed, but the twenty year collection clock starts when a warrant could first be filed.
A tax warrant is public and behaves like a lien. It attaches to your assets and shows up when you try to borrow, sell or refinance.
Your driver’s license is on the table. New York can suspend it over a tax debt above a set threshold, which has no federal equivalent and is the consequence that moves people fastest.
Installment payment agreements: available online below a set balance and term, and negotiated case by case above it, with a financial disclosure required on larger amounts.
The New York State offer in compromise is narrower. New York considers insolvency, a bankruptcy discharge, or undue economic hardship for individuals, and applicants must stay current on other filing and payment obligations.
07Engagement steps
How a back taxes engagement works
Transcripts first. Every decision a back taxes accountant makes after that depends on what they say.
Free consultation
How many years, roughly what the income was, and whether the IRS or New York has already been in touch.Authorization and transcripts
Form 2848 or 8821 for the federal account and wage records, plus New York Form POA-1 or TR-2000 for state access.Scope and fixed fee
Which years have to be filed, what relief looks reachable, and what it costs, agreed in writing before work starts.Returns prepared and filed
In the order that protects refunds and stops the failure to file penalty growing, which is not always oldest first.Relief and resolution
Penalty abatement claims, then the payment or settlement route the numbers support, federal and New York.
08What it costs
What back tax work costs
Priced per engagement, not by the hour. The main factors:
- How many years, and whether they are individual, business or both.
- Whether records exist or the returns have to be rebuilt from transcripts.
- Whether a substitute for return has already been assessed.
- Whether the engagement stops at filing or continues into penalty relief and resolution.
- Whether New York, another state, or foreign reporting runs alongside.
These are the factors, not a quote. Every engagement is scoped and quoted at a fixed fee before work starts.
From the record
What our clients say
“Taxes are a topic that people avoid. But what I always recommend, address it head-on. Take a look at what can be done.”
George Dimov, CPA
“I was 4 years behind on taxes. George got everything organized, filed and resolved for me in about a week!”
L G
Google review
10Related services
Where back tax work touches the rest of the practice
Talk to a back taxes accountant
Talk to a back taxes accountant
Tell us how many years, whether anything has already arrived from the IRS or New York, and roughly what the income looked like. We will tell you which years actually have to be filed and quote a fixed fee.