landscaper sch C hasnt filed his taxes in over 10 years,

Forum|Forum|1 year ago
April 5, 2025
2 replies
11 views

I have a client who has been operating a landscaping business for well over 10 years. His wife came to me and begged me to take over and help him get square with the IRS/bookkeeping.

I spoke with the women who does his invoicing(she does not touch his books), looked at his books and they are a mess. He apparently has had employees but has never submitted payroll, 1099's or any other accounting for how much, who or when they came and went. This is nothing to say how aweful his books are.

I feel like I might be able to stitch together his books for the last two years with reasonable accuracy but I am not a forensic accountant nor a tax lawyer so the deeper I look the more I worry that if I do attempt to file a tax return, I will be opening a pandoras box. I have no doubt that he has tax debt in the 5-6 figures and if I file a return, I may not be able to stop the freight train coming his way.

I am happy to help but I have a feeling that at this point, it might be too far gone. It seems their marriage is on the line so I am reluctant to tell them nothing can be done but I also dont know how bad it really is.

What would you advise they do? Should I try to help them sort their books or just pass them off? Should I file an extension or will an extension that comes with no real idea of how much is owed or even if he might try to pay it off just asking the IRS to come'a'calling?

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sjrcpa

Level 15

1. This is not the type of thing to deal with on April 4.

2. You can file an extension showing he owes $XXXXX. Will he pay?

3. I hope the wife has been filing MFS returns all these years.

4. If you do take this on after April 15:

a) You get a bucket of money upfront. When it's used up, you ask for more.

b) He hires a bookkeeper to construct/reconstruct books.

c) Plan on 3 years back taxes to get him in good stead.

5. Has IRS come calling? Have employees filed complaints, workman's comp claims? Does he have a valid business license? Has the state come calling?

Think hard before accepting. It's OK to say no. He probably should get a lawyer involved.

It's also OK to say I'll take a look for $XXX, upfront, and then let you know.

The more I know the more I don’t know.

qbteachmt

Level 15

This is the right call: "c) Plan on 3 years back taxes to get him in good stead."

I've done a few of these. One, it did destroy the relationship, but I was upfront about the discovery and its potential impact. The spouse took it as a complete personal affront, since she was the one who had been trying to maintain the records all the years, but had done so with no guidance. Also, I tried to make a referral to a CPA I love and send lots of people to, and they reported to me they had already turned this couple away years ago. There's no shame it it being beyond your interest or ability or outside of your practice. By passing on it, you are not making it worse.

And definitely get paid ahead.

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qbteachmt

Level 15

For me, it would depend on his interest to be involved. If he isn't an active participant in this resolution, I would stay out of it. You might be surprised how much is discoverable. You need him to get bank records and IRS account transcripts, to see what is already documented on his behalf. Probably not much, as noted by others. He likely has Venmo, CashApp, PayPal, too.

Don't yell at us; we're volunteers

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