IRS says no payment was made

[erchess]

Taxpayer is getting IRS letters saying that estate tax returns were filed for years as recently as 2003but payments were not made. Taxpayer says payments were made but proof is hard to come by since bank they were using at the time has been bought by another bank. The taxpayers certainly do not keep records that old. Do we have any alternative to paying what is asked? The amounts are small but the principle of the thing sticks in my craw and that of my client. I don't know if this is relevant but taxpayer stopped filing the trust returns in 04 and closed out trusts in 07 and 08 and I am in the process of cleaning up that mess.

[JohnH]

The bank will have records that far back - it will just take them some time to come up with them.

I'd ask IRS for additional time, explaining the reason.
They will grant it.

Of course, you may wind up learning that the payments were not made after all, in which case the client will be complaining about your bill for the wasted time. Guess it's all a matter of how much money is invilved in the first place.

[FEDUKE404]

Bottom line

Client is guilty until he can prove his innocence.

For my 2¢ worth: You better believe anything I am required to pay to the government is well-documented: bank record, canceled check (from the dark ages), credit card record, or whatever.

I tend to agree with JohnH, and also you cannot eliminate your client may have made payment to his income tax account instead and/or mailed it to the wrong place, or wrote check to "IRS," or the dog ate his payment.

FE

[AZ-Tax]

Client is guilty until he can prove his innocence.

Correction if I may: "Client is guilty until he or she can prove his or her innocence" its sad we Tax Preparers usually have to take this attitude but if anyone has been practicing for any length of time, you too will most likely take this attitude. I do find it hard to believe just because a bank got bot out, past records do not exist. I have a couple clients over the years who mailed in a check with their tax return and the IRS wrote that payment was not recieved and of course the first thing I tell my client "check your chkng acct to see if the check cleared". If so, obtain a copy of cancelled check. In one of my clients case, thes IRS really played hardball and my client ended up having to go to the local IRS office utilizing most of their day. Completely uncalled for. I instruct my clients always to enter the TP's SS# on the memo and make them do that in my office.