Thank you so much for sharing this. My biggest fear isn't even the money - it's losing his respect and trust. Did you find that having a professional already lined up helped with that conversation? I'm thinking maybe I should at least consult with someone before I talk to him, so I'm not just bringing problems but also some solutions. How did you start that conversation? I literally have no idea how to even begin telling him.

Having a professional already consulted absolutely helped. When I talked to my wife, I could say "I've messed up with our taxes, but I've already spoken with a tax professional and have a plan to fix it" instead of just "I've messed up and have no idea what to do." That made a huge difference in how she received the news. For starting the conversation, I chose a time when we were both relaxed and had privacy - not right after work or before bed. I simply said, "I need to tell you something important that I've been struggling with, and I need your support." Then I explained the situation directly without excuses, acknowledged it was wrong to keep it secret, shared the plan I'd developed with the tax professional, and asked for her partnership in moving forward.

Do you know how far back you can go with those retroactive contributions? I'm in a similar boat (though only 2 years behind) and hadn't considered this option at all.

Thanks for the tips about the character limit. Do you remember roughly how many characters they allow for the explanation? I want to make sure I explain the situation clearly but don't want to write something only to find out it gets cut off.

The explanation field is limited to 750 characters, which isn't much! I recommend drafting your explanation in a text editor first, checking the character count, and then pasting it into the form. Focus on the key facts: you weren't previously required to file because balances were under $10,000, you received a one-time large deposit for a pending real estate transaction in late 2022, you weren't aware this triggered the filing requirement, and you're voluntarily filing as soon as you realized your obligation. That covers the main elements of reasonable cause in a concise way.

For FBAR civil penalties, the statute of limitations is generally 6 years from the date of the violation (the due date of the unfiled FBAR). So for a 2020 FBAR that was due in 2021, the statute would typically run until 2027. However, I'd strongly recommend filing the delinquent FBAR as soon as possible regardless. The IRS has streamlined filing procedures for those who weren't aware of filing requirements, but voluntary disclosure before any contact from the IRS is key to avoiding penalties.

Does FreeTaxUSA not let you access your old returns? I thought most tax software kept that available for you to see even after filing.

FreeTaxUSA does let you see your returns from previous years if you create an account and log in, but some of the detailed information and worksheets can be limited unless you pay for the premium service again. Basic access is there, but not always everything you might need. The bigger issue is if you use a different email or forget your login credentials, then accessing old returns becomes much more difficult. Having your own saved PDF gives you full access to everything regardless of account status or if the company ever changes their policies. It's just good practice, especially for important financial documents you might need for loans, mortgage applications, or financial aid in the future.

I had a similar experience - estimate was within $5 of my actual refund. I think they're pretty reliable for basic tax situations. Did yours come in the timeframe they estimated too?

I don't think they had anything like that. It was a pretty small franchise operation and they handed out physical paychecks every two weeks. I never got any login information for viewing stuff online. But that's definitely good to know for future jobs!

This is great advice! I did the same thing in California and the labor board was super helpful. The business got fined and suddenly they were very responsive about getting me my documents.

Do you need to attach any special form or explanation when you file with corrected 1099-Rs? I'm worried the IRS computers will flag my return because they already have the original incorrect forms.

You don't need to attach a special form when filing with corrected 1099-Rs. The company will submit the corrected forms to the IRS with a clear indication they're corrections, so the IRS systems will update accordingly. If you're concerned about potential issues, you can include a brief statement with your return explaining the situation and noting that corrected forms were issued. This isn't required, but it can be helpful if your return gets manually reviewed. Just make sure you're using the information from the corrected forms when you file.

This happened to me too! My old 401k provider charged a $75 "account termination fee" when I rolled over to an IRA, and they withheld taxes on that amount since it wasn't part of the rollover. It showed up as a separate 1099-R with code 1.