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Has anyone actually had experience with the IRS coming after someone for unfiled returns when they were owed money? My cousin was in a similar situation (5 years unfiled) but never heard anything from the IRS. I always figured they only care if you owe them money???
The IRS generally doesn't pursue people aggressively for unfiled returns that would result in refunds - they're more concerned with collecting unpaid taxes. However, there are automated systems that can flag missing returns regardless of whether tax is owed. The bigger issue is the downstream effects. Your son might face problems getting approved for mortgages, student loans, or other financial instruments that require tax return verification. Some government programs also require proof of tax compliance. And if he ever gets audited for a different year, they may expand the audit to include those unfiled years.
I went through this exact situation with my own adult child two years ago - 8 years of unfiled returns! Here's what worked for us: 1. Start with the most recent 3 years FIRST (2024, 2023, 2022) since these can still get refunds. We used TurboTax's prior year versions which made it much easier. 2. Get organized - create a folder for each tax year and gather all documents systematically. The IRS wage transcripts mentioned above are a lifesaver for missing W-2s. 3. Don't try to do all years at once - we did one year per weekend to avoid burnout and mistakes. 4. The good news: since your son had taxes withheld, he likely won't face penalties and is probably owed money for those recent years. 5. For the older years beyond the refund window, we filed them all together after finishing the "money years" first. Total recovery for my child was over $7,000 from just the 3 eligible years! The peace of mind was worth even more. You're being a great parent helping him get compliant. It's overwhelming at first but very doable if you break it down year by year.
My extension request last year wasn't accepted until April 17th (two days after the deadline) but I still didn't get any penalties because I submitted on April 14th. The IRS system gets super bogged down right at the deadline so delays are normal. Your submission date is what matters!!!!
Thanks for sharing your experience! That's reassuring. Did you get any kind of confirmation email when you initially submitted the extension? I submitted mine but only got a "we received your transmission" email, not an actual acceptance.
I went through this exact same panic last year! Filed my extension on April 14th through FreeTaxUSA and didn't get confirmation until April 18th. I was freaking out thinking I'd get hit with penalties, but everything turned out fine. The key thing to remember is that the IRS considers your extension "filed" the moment you hit submit, not when they send you confirmation. As long as you submitted before midnight on April 15th (which you did on April 13th), you're protected from the failure-to-file penalty. Since you included your estimated tax payment of $2,300 with the extension, you should also be protected from most late payment penalties. The IRS is pretty reasonable about this - they know their system gets overwhelmed right at the deadline. Keep your submission confirmation from TurboTax as proof of your filing date. That timestamp is gold if you ever need to dispute any penalties. You did everything right - try not to stress about it!
One thing nobody's mentioned yet - be careful of predatory "tax schools" that charge a fortune and promise jobs. I fell for one that cost $2k and their "guaranteed job placement" was just referring everyone to H&R Block who would have hired us anyway with their free training.
Seconding this warning. Look for programs through community colleges or professional associations instead. I wasted money on one of those tax schools too and ended up learning more from free IRS materials.
This is such great timing for this question! I actually made the transition from retail to tax preparation about 5 years ago and it was one of the best career moves I've made. Here's my practical roadmap based on what worked for me: **Start with the basics:** Get your PTIN first (as others mentioned) - it's required and shows you're serious. Then dive into the IRS Publication 17 (Your Federal Income Tax) - it's free and comprehensive. **Timeline for getting hired:** If you start studying now, you can absolutely be ready for next tax season. Most tax prep companies start hiring in October/November for the January-April rush. Focus on individual returns first - that's 90% of what you'll see at entry-level positions. **Best bang for your buck:** The IRS Annual Filing Season Program is gold standard and FREE. Combine that with practice software (many companies will train you on their specific software anyway). **Real talk on the work:** It's seasonal and intense during tax season, but the pay is significantly better than retail. I went from $12/hour in retail to $18/hour my first tax season, and now I'm at $28/hour with my EA credential. The attention to detail and customer service skills you've developed in retail actually translate really well to tax prep. You've got this! Feel free to ask if you want more specific advice on any part of the process.
This is incredibly helpful! I'm curious about the seasonal nature of the work - what do most tax preparers do during the off-season (May through December)? Do you work another job, or are there enough year-round opportunities in tax prep to make it sustainable as a full-time career? Also, how challenging was it to transition from the $18/hour starting wage to where you are now at $28/hour - was that mainly through getting the EA credential or building up a client base?
Has anyone successfully used the "Reasonable Basis" safe harbor protection for their S-corp contractor status? My accountant mentioned this as a way to strengthen my classification position with potential clients, but I'm not sure how to effectively communicate this to companies that seem set on using staffing agencies.
The "Reasonable Basis" safe harbor can definitely strengthen your position, but it's not a simple concept to explain to clients. It essentially means that if you have a reasonable basis for treating workers as independent contractors (like following industry practice or relying on past IRS audits), you get additional protection. For S-corps specifically, there's substantial precedent supporting the classification distinction. I've had success creating a simple one-page addendum to proposals that specifically references Section 530 of the Revenue Act and how it applies to incorporated contractors with their own employees (even if that employee is just you as the owner). Including relevant case citations shows you've done your homework.
That's really helpful, thanks! I'll work with my accountant to put together something similar. Do you find that this approach works better with smaller companies or is it effective with larger corporations too?
This is such a frustrating trend that's affecting a lot of us incorporated contractors. I've been dealing with the same issue with my C-corp consulting business - companies that used to hire me directly now insist on going through agencies, even when I can demonstrate that my corporate structure actually provides better classification protection than many agency arrangements. What's particularly maddening is that these companies end up paying MORE for the same work (agency markup + my rate) while getting less direct communication and flexibility. I've started including a brief "Independent Contractor Classification FAQ" with my proposals that explains how incorporated contractors differ from sole proprietors in terms of classification risk, but it's an uphill battle against blanket policies. The education aspect is key - most hiring managers genuinely don't understand that when you're working through your own S-corp or C-corp, you're technically an employee of your corporation, which creates the separation they're looking for. Has anyone had success getting procurement or legal departments to review and approve exceptions to "agency-only" policies?
Omar Fawaz
Here's exactly what happens with hardship requests and how to interpret your transcript: 1. When a hardship (Form 911) is approved, the IRS flags your account with a Hardship CNC (Currently Not Collectible) status 2. This prevents automatic offsets that would normally appear as TC 898 codes 3. Your transcript will NOT show a specific "hardship approved" code - the absence of offset codes is your indicator 4. The system processes your refund normally, shown by TC 846 when issued 5. Hardship status typically lasts 6-24 months depending on your financial situation 6. The underlying debt remains but collection is paused Based on your description, your hardship was likely approved, which is why no offset codes appear.
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Diego Vargas
β’Just to clarify - hardship status (CNC) typically expires on January 15, 2025 if approved now, or when your financial situation improves. The IRS will send Notice CP503 when they resume collection. The debt will continue to accrue interest at 7% annually even during the hardship period.
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Anastasia Fedorov
β’This hardship process is like hitting a pause button on a video game, isn't it? The game isn't over, but you get a breather. I'm curious - does anyone know if accepting the hardship extension affects your future ability to request payment plans or settlements with the IRS?
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Mohammed Khan
Your situation sounds very promising! The absence of offset codes like TC 898 or TC 826 on your updated transcript is actually a really good sign, especially since you mentioned filing a hardship form. The IRS is pretty consistent about showing these codes when they plan to take your refund - if they're not there by now, they're likely not coming. I went through a similar scare two years ago and kept obsessively checking my transcript daily, but no codes ever appeared and I got my full refund. The hardship process really does work when you have legitimate financial difficulties. Keep monitoring your transcript and Where's My Refund, but honestly, I think you're in the clear!
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Jeremiah Brown
β’That's really reassuring to hear from someone who went through the same thing! I've been checking my transcript obsessively too - probably way more than I should be. It's such a relief to know that the absence of those codes is actually a good indicator. Did you have to provide a lot of documentation for your hardship approval, or was the process pretty straightforward? I'm still a bit nervous about celebrating too early, but your experience gives me hope that the system actually works sometimes.
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