In 2003 client started small business paid self salary and made federal quarterly deposits. Never filed end of year or W-2 forms and 1040. IRS is after them now for 2003 1040. Business is being reported on Schedule C small profit.How do I have the money sent on the quarterly deposits put toward money owed on 1040. Money is almost all self employment tax.Do not do any payroll or payroll reports for other clients.
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The statute of limitations for claiming a refund on the 2003 1040 has expired. Any overpayment of tax due to W-2 withholding is lost.
If no 1040 return was filed, no 941, 940, W-3, or W-2 was filed, all income was Schedule C income, and the only taxes paid was those incorrectly deposited because the taxpayer thought he/she was a W-2 employee of his/her Schedule C business, then I don't know what the answer is. There are no IRS instructions for how to correct this huge of a screw up.
My guess is the W-2 withholding is lost and cannot be recovered. You could file the Schedule C, put the W-2 withholding on the 1040 as estimated taxes paid, and then see what IRS does. When they send you a rejection letter, write a letter of explanation explaining every screw up. Maybe someone at IRS would have a big laugh over the idiot taxpayer and be willing to help your client out of pity.Last edited by Bees Knees; 10-30-2008, 09:59 AM. -
I'm surprised the client sought professional advice.
After all, things have been going along without a hitch up until now, and think of all those accounting fees he saved!"The only function of economic forecasting is to make astrology look respectful" - John Kenneth GalbraithComment
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Try the advocates office.
They may be able to work through the mess.In other words, a democratic government is the only one in which those who vote for a tax can escape the obligation to pay it.
Alexis de TocquevilleComment
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I had a simular situation and had no problem switching W-2 withholding to 1040 estimated taxes. A simple telephone call did it.This post is for discussion purposes only and should be verified with other sources before actual use.
Many times I post additional info on the post, Click on "message board" for updated content.Comment
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quarterly deposits
I am also trying to have the employer FICA & MEDICARE payments credited. The reason that they sought help is that they are now W-2 employed and the IRS has finally found them.They used to live on a boat with no fixed address.Comment
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