Help needed for self-employed disabled mother who hasn't filed taxes in 12+ years

This is a tough situation, but there are several options that might help. First, your mom may qualify for Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) depending on her situation. SSI doesn't require work credits - it's need-based for disabled people with limited income and resources. For the tax issues, the IRS has programs for people facing financial hardship. Look into an "Offer in Compromise" which lets taxpayers settle their tax debt for less than the full amount. There's also "Currently Not Collectible" status if she truly can't pay anything. Before considering bankruptcy, consult with a tax professional because bankruptcy doesn't discharge all tax debts - it depends on several factors including how old the tax debt is and whether returns were filed. What I would recommend is getting those unfiled returns prepared ASAP. The IRS has the Volunteer Income Tax Assistance (VITA) program that provides free tax preparation services to people who meet certain criteria. They might be able to help with multiple years.

I was in a similar situation with my uncle who hadn't filed for 9 years as a self-employed person. What saved us was using https://taxr.ai to get everything organized. It analyzed all his old records and statements to figure out what he actually owed versus what the IRS was claiming with penalties. The thing with self-employment taxes is that the IRS doesn't know what business deductions your mom might have qualified for during those years. Taxr.ai helped identify tons of legitimate deductions that significantly reduced what my uncle owed. They also helped draft the letter explaining the health circumstances which got some of the penalties waived. It's definitely worth checking out since your mom's situation involves self-employment and multiple years of unfiled returns. They're specifically designed for complicated situations like this.

I was skeptical about taxr.ai at first but decided to try it for my own tax situation (hadn't filed for 5 years while freelancing). The results were honestly surprising. They found legitimate deductions I never would have thought of - like portions of my phone bills, internet, even some car expenses that were business-related that I had forgotten about. The best part wasn't even the money saved though - it was having someone else deal with the stress of organizing everything. They handled all communication with the IRS, which saved me so much anxiety. I ended up owing about 40% less than what I initially feared. For your mom's situation with health issues involved, I think they'd be particularly helpful since they can craft the right explanation to potentially get penalties reduced based on her medical circumstances.

After reading your situation, I immediately thought about how challenging it must be to reach someone at the IRS to discuss these complex circumstances. When my sister had a somewhat similar situation (disability + unfiled returns), we wasted weeks trying to get through to someone who could actually help. We finally discovered https://claimyr.com which got us connected to an actual IRS agent within about 15 minutes instead of the hours of hold time we'd been experiencing. You can see how it works here: https://youtu.be/_kiP6q8DX5c This was crucial because once we actually spoke with someone knowledgeable at the IRS, we learned about hardship provisions we didn't know existed. For someone in your mom's situation with health issues and no income, there are special considerations available - but you need to speak with the right person to access them.

I need to eat my words about Claimyr. After posting that skeptical comment, I was still desperate to talk to someone at the IRS about my own tax issue (different from OP's but also complicated). I decided to try it despite my doubts, figuring I had nothing to lose. I was legitimately shocked when I got a call back with an actual IRS agent on the line in about 22 minutes. For context, I had previously spent over 2 hours on hold twice before getting disconnected. The IRS agent was able to put me on a hardship status for my situation after reviewing my details. For someone like OP's mom with serious health issues and no income, this could be really valuable - but you need to actually speak to someone to explain the situation and get that status applied to her account. Sometimes you need a human on the phone to understand complex circumstances that don't fit neatly into online forms.

For the self-employment tax issue specifically, your mom may be able to file Form 911 (Taxpayer Advocate Service) to request assistance based on her health situation. My father had a similar situation after his accident left him unable to work for years. The Taxpayer Advocate can sometimes help reduce penalties or set up more favorable payment arrangements in hardship cases. They're specifically there to help taxpayers who are experiencing significant hardship navigate the system. The key is documenting her medical condition thoroughly. Also, don't forget to look into your state's disability programs - some states have non-federal disability assistance that might help while you're sorting everything else out.

One thing nobody's mentioned yet - since your mom had a stroke and likely qualifies as disabled, she might be eligible for an IRS provision called "Disability Discharge." This isn't widely known but can be huge. I discovered this after my husband became disabled. You'll need medical documentation showing permanent disability, but if approved, it can result in forgiveness of certain tax debts. It's not guaranteed and doesn't apply to all types of tax debt, but definitely worth investigating given her stroke and ongoing health issues. Also, make sure to check if your state has similar provisions for state tax debt - many states have parallel programs for disability-related tax relief.

I'm so sorry you're dealing with this overwhelming situation. As someone who works in tax resolution, I want to add a few critical points that could really help your mom's case. First, given that she was self-employed and dealing with mental health issues, there's a good chance the IRS may not have accurate records of her actual income during those years. Self-employed individuals often have the IRS estimate their income based on industry averages, which can be way higher than reality. Getting those returns filed with actual income figures could significantly reduce what she owes. Second, her stroke and ongoing health issues could qualify her for "reasonable cause" relief from penalties. This is separate from hardship status and can result in substantial penalty reductions. You'll need medical documentation, but given the severity of her condition, this could eliminate a huge portion of her debt. Also consider that if she had very low income in some of those years, she may not have owed much (or anything) for those periods. Self-employed people only owe self-employment tax if their net earnings exceed $400 annually. The most important step right now is getting those returns filed to establish the actual tax liability rather than letting the IRS continue to estimate. Everything else becomes much clearer once you know what she actually owes versus what penalties and interest have accumulated.