That's a really good point I hadn't even considered. I've lived in the same state this whole time, but I should definitely look into their policies. Is there an easy way to find out about state voluntary disclosure programs?

The easiest way is to just google "[your state] tax voluntary disclosure program." Most state tax department websites have a section for this. Some states are surprisingly forgiving if you come forward voluntarily. Be aware that some states have shorter lookback periods than the IRS. For instance, my state only required me to file 3 years back, even though federally I had to do 6 years. Some state programs will waive penalties but not interest on what you owe.

Did you file all 7 years at once or space them out? I heard you should do the most recent ones first.

8 Do these credits apply if the improvements were done by the previous owner right before selling? The listing mentioned they installed new energy efficient windows and HVAC a month before I bought the place.

3 Unfortunately, no. The energy efficiency tax credits only apply to improvements you made yourself after purchasing the home. The previous owner would have been eligible to claim those credits on their return, but you can't claim credits for improvements made before you owned the property. If you make your own energy efficient upgrades in the future though, definitely keep all receipts and manufacturer certifications. The credits are quite generous through 2032 under current law!

11 Is this true for Roth IRAs too? I took out some money from my Roth for closing costs and wasn't sure if I needed to report it.

22 Refugee claimants can apply for a work permit while their claim is being processed, but there are restrictions. The work permit usually specifies what type of work they can do, and running a business with employees is generally not permitted without permanent residence status or specific entrepreneurial immigration programs. The friend should consult with an immigration lawyer about proper pathways. There are sometimes special programs for entrepreneurs depending on the province, but trying to circumvent the system by using someone else's GST number could jeopardize their refugee claim entirely.

4 Thanks for the clarification. That's what I was afraid of - sounds like there's really no legitimate shortcut here. I'll suggest that my friend needs to consult with both an immigration lawyer and a business attorney before proceeding with anything. Better to do things properly than risk their status and my financial wellbeing.

9 That's terrifying! Did your friend manage to resolve the situation or are they still dealing with the fallout? Did they have to pay the full amount?

19 This is great advice. My mother got a letter because she forgot about a small stock sale that generated a capital gain. The brokerage reported it to the IRS but she forgot to include it on her return. Does your grandmother have any investments or retirement accounts?

7 Both great questions! For unusual income, she did sell some stocks last year after my grandfather passed away. She's not very financially savvy and has been relying on their longtime accountant who's getting up there in age himself. Regarding prior notices, that's actually very possible. She doesn't open all her mail right away and sometimes sets aside things she doesn't understand. I'm going to visit her tomorrow and go through her mail from the past few months to see if there were earlier notices. The investment angle seems most likely based on your experiences. I'll definitely check on that specifically when I see the letter. Thank you both for the helpful suggestions!

6 Those gift card scams are terrible! My neighbor fell for one of those and lost $2000. Definitely check the payment methods requested. The real IRS offers multiple payment options and NEVER asks for gift cards, wire transfers, or cryptocurrency.

That's a great idea! I hadn't thought of checking her bank statements. Do you think the amount would be specifically labeled as "car tax" or would it just show as a payment to the county?

It probably won't say "car tax" specifically. In my dad's case, it just showed as a payment to the county treasurer with a reference number. But if you can match the amount and approximate date (usually due the same time each year), that can be enough. Your tax preparer mainly needs the amount paid for deduction purposes. If your mom paid by check, there might even be a memo line notation, or you could look at the back of the canceled check image to see how it was processed. Sometimes the county puts identifying numbers on those.

This is what saved me when dealing with my grandpa's taxes! His accountant had backups of almost everything, including property tax statements going back nearly a decade. Worth a phone call at least.

I hadn't thought of that either! I'm not sure if she used the same preparer before, but it's definitely worth asking. Thanks for the suggestion!