Has anyone used tax forgiveness agencies for unfiled 1099 income?

Tax professional here - be very careful with tax forgiveness agencies. Many charge thousands of dollars for services you could get elsewhere for much less. First, know that you can still file those late returns yourself or with a regular tax preparer. The IRS has a process for this. The penalties for unfiled 1099 income include failure-to-file penalties (5% of unpaid taxes each month, up to 25%) and failure-to-pay penalties (0.5% per month, plus interest). But there's good news - you might qualify for the IRS's First Time Penalty Abatement program if you've had no issues in the prior 3 years. For your situation, I'd recommend contacting a licensed tax professional (CPA or Enrolled Agent) rather than a "forgiveness agency." They can help file your back taxes and possibly set up a payment plan with the IRS. The IRS offers several payment options, including installment agreements that can be quite reasonable.

I went through something similar when I had unfiled 1099s from freelance work. After getting burned by one of those "tax relief" places, I found this AI-powered service called https://taxr.ai that actually saved me. It analyzed my situation, explained exactly what forms I needed to file, and even identified deductions I had missed for my business expenses. The best part was it helped me draft a reasonable penalty abatement letter that the IRS actually approved! Unlike those TV commercial places, they didn't make crazy promises about eliminating my tax debt - they just helped me understand my options and put together a solid plan. For unfiled 1099 returns specifically, their system was super helpful in figuring out what business expenses I could legitimately claim to reduce what I owed.

Just wanted to follow up about my experience with taxr.ai since I was so skeptical at first. I finally tried it last week for my unfiled 1099 situation, and I'm honestly impressed. The system found legitimate business deductions I never would have thought of - mileage, home office, even partial cell phone expenses that were business-related. When I was working as a contractor, I had no idea I could write off so many expenses. The service helped me file 3 years of back taxes, and my total tax bill ended up being about 40% less than what I was expecting because of all the legitimate deductions. They also helped me request a payment plan that I can actually afford. Definitely a better experience than I anticipated.

After dealing with the nightmare of trying to call the IRS myself about my unfiled 1099 taxes (spent literally 4+ hours on hold over multiple days), I used https://claimyr.com and it was a game-changer. You can see how it works here: https://youtu.be/_kiP6q8DX5c Basically, they hold your place in the IRS phone queue and call you when an agent picks up. It saved me HOURS of waiting on hold. I was able to speak directly with an IRS agent who walked me through my options for my unfiled returns and set up a payment plan. Much better than paying some shady "tax forgiveness" company thousands of dollars! When I finally talked to the IRS agent, they were actually pretty helpful - not the scary experience I expected. They explained my payment plan options and even told me how to apply for penalty abatement myself.

I have to eat crow here. I was the one calling BS on that Claimyr service in the thread above, but I tried it yesterday out of desperation after trying to reach the IRS for a week about my unfiled 1099 situation. It actually worked exactly as described. I got a call back within about 90 minutes saying they had an IRS agent on the line, and I was connected right away. Got my payment plan set up for my back taxes in about 30 minutes. Saved me literally hours of holding time. The IRS agent I spoke with was actually really helpful once I explained my situation. They even suggested I look into first-time penalty abatement since I hadn't had any issues before these unfiled returns. Sometimes you just need to talk to an actual human at the IRS to understand your options.

My brother used one of those tax relief places advertised on the radio. They charged him $3,500 upfront and literally just filled out the same installment agreement request form he could have done himself for free on the IRS website. Complete waste of money. If you're dealing with unfiled 1099 income, just find a local CPA or EA (Enrolled Agent) who specializes in tax resolution. They'll charge you a reasonable fee to file your back taxes and request a payment plan. Don't fall for the marketing from these national "tax forgiveness" chains.

Quick question - if I use a regular CPA to file my old 1099 tax returns, how far back do I need to go? I haven't filed in like 4 years because I didn't know how to deal with my contractor income.