Bankruptcy, IRS

[geekgirldany]

I don't understand. I got a email late tonight from a customer saying the following:

"I got a letter today from the IRS that says I have 4 days to turn in my 2007 income tax or they can opt to have my bankruptcy dropped."

Last year I filed several years of returns and figured out they needed them for bankruptcy. Does anyone know what this means about the IRS wanting their 2007 returns? I've never heard of this.

[David1980]

Doesn't make any sense to me.

However, from personal experience whenever a client gets a letter you always ask to see the letter. It's amazing how different what the letter says is from what the client says that the letter says sometimes. They often read only a part of it and get the wrong impression.

So get the letter before speculating too much on it. Obviously if the client thinks they only have 4 days they'll make it a priority.

[S T]

My thoughts

I am like David, doesn't make sense, but then most of us are always skeptical about the notices that are received, due to scams, and phishing.(sp)

If it is that urgent from the IRS, they would send a certified return reciept requested, and if you are on POA, you would also receive a copy certified mailing.

Obtain the letter that the t/p received, and then go from there. There should be a contact number on the letter.

Sandy

[geekgirldany]

Thank you guys for responding. That is true. The letter could be saying something completely different. I don't have a POA on file so I am not getting any notices they would get. Since the due date for 2007 is more than 4 days away it just doesn't sound right. I did not think of a phishing/scam letter. That is possibility. I will see what the letter says.

[Koss]

Bankruptcy

That letter might be from the Bankruptcy Court or from The Bankruptcy Trustee.

Depending upon when they originally filed the bankruptcy petition, the taxpayer or their attorney might have agreed to submit a copy of the 2007 tax return to the court by a certain date. Or the court might have issued an order based on the presumption that the taxpayer could complete their 2007 tax return by March 15 or something.

If the petitioner fails to comply with certain basic rules and expectations within the bankruptcy process, the whole case may be dismissed.

There are also some very complicated rules about whether and when tax debt can become part of a bankruptcy case.

I agree that you have to see the letter in order to figure this one out.

[Jesse]

Agree w/ others, you need to see the letter.

Also agree w/ Koss. A year or 2 ago a client an individual who also had an LLC filed bankruptcy and IRS contacted to threaten dismissal of case unless payroll returns were filed. It was a case were the LLC had two different FEIN numbers, one for the LLC and one for the payroll, but for years the payroll and all returns were filed under only one FEIN number.

It took a letter to clarify the matter, but in bankruptcy proceedings even though IRS debt is not being discharged ALL returns must be filed. The IRS did notify the client, not the bankruptcy court.

If they did file bankruptcy in 2008 the 2007 return needs to be filed before any discharge of debt. Hopefully they contacted the lawyer as well as you.

[geekgirldany]

I just got off the phone with the customers. They are bringing the letter by tonight. He said everything had been going along smoothly and they were waiting on a Discharge Letter from the Court. The IRS letter was received on March 28 and it said they had 14 days to comply. Was received at a relatives house not certified mail. Relative mailed it off from another state to customer. He said it had all their information on it about the bankruptcy. Had something on there about the court and IRS.

They filed in 2007 for bankruptcy. It sounds like it maybe a letter from the court than the IRS. I'll see tonight. I am leaning towards the court. I don't think the lawyer has been called. I will make the suggestion.

THank you all posting

EDIT: Relative received a certified letter today.

[geekgirldany]

Appears to be legit. Letter 1714 and this is listed on the IRS website as a request for tax returns.

"Letters initiated by Insolvency may include AIS Letter 1714, Request for Returns or Return Information, to secure missing or unfiled returns, or other AIS letters as appropriate."

Address jives with local office listed in the state bankruptcy is being claimed. From my reading lawyer should have got a copy. Going to see if he can call the person listed and ask them to wait until Thursday atleast.