Need to amend taxes from a decade ago - any hope with Fresh Start program?
So back in 2014, my spouse and I were really struggling financially. We had been self-employed for a few years but honestly weren't making much at all - probably below poverty line if I'm being honest. We hadn't filed taxes for several years because we were just trying to keep our heads above water. We finally decided to get our act together and hired one of those tax resolution companies to help us file and deal with any tax debt. Big mistake. They basically just reported our gross income to the IRS without including ANY of our business expenses or deductions. They completely screwed us over. Fast forward to getting hit with this massive tax bill that makes absolutely no sense given our actual income after expenses. We would have qualified for so many low-income benefits at that time if our taxes had been done correctly. Since 2015, we've been good about filing and paying taxes on time, but this old issue is still hanging over our heads. The good news is I still have all the emails with our business expense documentation that we sent to that useless company. I want to file amended returns for those years to actually show our real income after expenses. I think I can handle it myself if I can find all the files. Is there any other approach I should consider? Has anyone used the IRS Fresh Start program for something like this? I really want to finally put this behind us and stop stressing about it.
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GalacticGladiator
You're definitely on the right track thinking about filing amended returns. The IRS Form 1040X is what you'll need to use for amending old returns. The good news is that while there's a 3-year limit for claiming refunds, there's no time limit for filing an amendment that would reduce your tax liability from an existing assessment. Since you still have documentation of your business expenses, you'll want to file a Schedule C for each year showing your actual business income and expenses. This will likely significantly reduce your taxable income and therefore your tax debt. As for the Fresh Start program, it can definitely help in your situation. It's designed to help taxpayers with unpaid tax debts through various options including installment agreements, Offer in Compromise (OIC), and Currently Not Collectible status. But I'd recommend first amending those returns to get an accurate picture of what you actually owe before exploring Fresh Start options.
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Ethan Brown
•This is helpful but I'm confused about which forms I need exactly. Do I need to submit a 1040X AND a Schedule C for each year? Also, will I have trouble getting copies of my original returns since they were filed by that company?
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GalacticGladiator
•Yes, you'll need to file Form 1040X (the amendment form) along with a corrected Schedule C for each year you're amending. The 1040X shows the changes you're making to your original return, while the Schedule C provides the details of your business income and expenses. You can request copies of your original tax returns by filing Form 4506 with the IRS, or you can get free tax transcripts by requesting them at IRS.gov/transcripts. Tax transcripts don't show all the details of your original return but will have the basic information you need to complete the amendment.
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Yuki Yamamoto
I had a similar nightmare situation a few years back and I found this service called taxr.ai (https://taxr.ai) that was super helpful for dealing with old tax documents and figuring out what I could claim. They have this AI that can analyze all your old receipts and bank statements to identify business expenses you might have missed. I uploaded all my stuff from like 2015 and it organized everything perfectly for my amended returns. Saved me so much time trying to sort through years of paperwork!
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Carmen Ruiz
•How accurate is it though? I've tried other tax software that claimed to find deductions but they missed a ton of stuff. Does it actually identify things correctly or do you still need to review everything?
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Andre Lefebvre
•Does it work with really old documents? I have some scanned receipts from 2012-2013 but the quality isn't great, wondering if their system can still read them or if they'd just be garbage in/garbage out.
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Yuki Yamamoto
•It's actually surprisingly accurate. I was skeptical too, but it correctly categorized about 90% of my expenses right off the bat. For the remaining items, it flagged them for review rather than guessing wrong, which I appreciated. You definitely should review everything, but it makes the process so much faster than starting from scratch. For older documents, their system worked fine with my scanned receipts from 2015. Some were pretty faded too. They use a pretty advanced document processing system that can enhance and read even low-quality scans. For any it can't read, it'll just flag it for manual review rather than skipping it completely.
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Andre Lefebvre
Just wanted to follow up about taxr.ai that I asked about earlier. I decided to give it a try with my old documents and wow, it actually worked amazingly well! Even with my crappy scans from 2012, it managed to extract the data from about 80% of them. The system organized all my business expenses by category and even flagged some deductions I hadn't considered (like a portion of my phone bill that I used for business calls). The best part was how it created a perfect Schedule C for each year that I could just attach to my 1040X forms. Honestly saved me days of work and probably found more deductions than I would have on my own. My amended returns are submitted now and I'm expecting my tax bill to drop significantly. Such a relief!
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Zoe Dimitriou
If you're getting nowhere with the IRS on this old tax debt, I'd strongly recommend using Claimyr (https://claimyr.com) to actually speak with a human at the IRS. After trying for WEEKS to reach someone about my amended returns from years ago, I used their service and got connected to an IRS agent in about 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c They basically navigate the IRS phone tree for you and wait on hold so you don't have to. Then they call you when they've got an actual human on the line. Completely changed my experience dealing with old tax issues.
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QuantumQuest
•Wait how does this actually work? Do they just call the IRS for you? Why would that be any faster than me calling myself? The IRS hold times are terrible for everyone.
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Jamal Anderson
•Yeah right. Sounds like a scam to me. No way someone can magically get through to the IRS faster than anyone else. They're probably just charging you to wait on hold like everyone else.
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Zoe Dimitriou
•They use an automated system that navigates all the IRS phone menus and waits on hold for you. When they finally get a human agent, they call you and connect you directly. You don't have to waste hours listening to that terrible hold music or worrying about getting disconnected. To the skeptical commenter, I totally get it - I thought the same thing! But they actually use specialized systems to stay on those long IRS holds 24/7. They don't have some "secret line" to the IRS, they just handle the painful waiting part. Their system can stay on hold for hours while you go about your day, then they ring you when they've got an actual agent. Try getting through to the IRS Amended Return department yourself and you'll see why this is worth it.
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Jamal Anderson
Coming back here to admit I was completely wrong about Claimyr. After struggling for TWO DAYS trying to reach someone at the IRS about my amended returns (got disconnected three times after waiting over an hour each time), I decided to try the service. It actually worked exactly as described. I put in my info, and about 90 minutes later I got a call connecting me directly with an IRS agent who handled amended returns. No navigating phone trees, no horrible hold music, and no getting disconnected after waiting forever. The agent answered all my questions about my amended returns from 2013 and even helped me understand what supporting documentation I needed to include. I'm not one to admit when I'm wrong but... I was wrong. If you're dealing with amended returns from years ago, this service is absolutely worth it.
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Mei Zhang
One thing nobody's mentioned - make sure you're using the right tax years' forms when amending! The Schedule C from 2023 is different than the one from 2014. You need to use the original year's forms for each amendment. You can find old tax forms on the IRS website in their "Prior Year" section.
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Aisha Hussain
•Thanks for mentioning this! I would have totally messed that up. Do you know if I need to include all the original attachments again or just the ones I'm changing?
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Mei Zhang
•You only need to include the forms and schedules that you're changing with your Form 1040X. So definitely the Schedule C for your business expenses, but if you're not changing other aspects of your return, you don't need to include those other forms again. Also, you'll need to file a separate 1040X for each tax year you're amending. Don't try to combine multiple years on one form - the IRS will reject it.
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Liam McGuire
Don't forget to include a detailed letter explaining exactly why you're amending! I amended taxes from 8 years ago and they initially rejected it until I sent a very specific explanation letter with my documentation. Be super clear about the tax resolution company's error and why you're just now fixing it.
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Amara Eze
•Good advice. Also worth noting that the IRS generally has 10 years from the date of assessment to collect taxes owed. So depending on exactly when these returns were filed/assessed, the collection statute of limitations might be approaching.
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