Never filed 2021 and 2022 taxes and owe ~$135k - Should I use TurboTax or hire a tax pro for back taxes?
Title: Never filed 2021 and 2022 taxes and owe ~$135k - Should I use TurboTax or hire a tax pro for back taxes? 1 I totally messed up and haven't filed my taxes for 2021 and 2022. The situation is pretty bad because I'm looking at owing around $135k to the IRS for those years combined. I was self-employed during that time and didn't make any estimated payments (stupid, I know). Now I'm trying to get caught up before things get worse. My question is whether I should just use TurboTax to file these back taxes or if I need to hire an actual tax professional. Given the amount I owe, I'm wondering if there might be some negotiations or payment plans with the IRS, and if that's something I'd need a professional for? Or can TurboTax handle everything for filing back taxes when you owe substantial amounts? I'm worried about making things worse if I try to DIY this with TurboTax, but professional accountants are expensive too. Any advice on which route makes more sense for back taxes with large amounts owed?
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Javier Torres
8 For back taxes with a liability of ~$135k, I would strongly recommend working with a tax professional rather than using TurboTax. Here's why: When you're dealing with multiple unfiled years and a significant tax debt, there are several strategies a professional can help with that software typically can't. A CPA or Enrolled Agent specializing in tax resolution can potentially: 1) Identify deductions and credits you might miss on your own 2) Negotiate an installment agreement tailored to your financial situation 3) Determine if you qualify for an Offer in Compromise (settling for less than you owe) 4) Request penalty abatement to reduce the overall amount 5) Address any potential issues before they become bigger problems TurboTax is great for relatively straightforward tax situations, but with unfiled returns and significant liability, professional guidance will likely save you more than it costs.
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Javier Torres
•3 Do you think I could maybe use TurboTax to at least prepare the returns first and then have a professional review them before filing? Would that save some money?
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Javier Torres
•8 While preparing your own returns first might seem like a cost-saving approach, I wouldn't recommend it in your situation. A tax professional needs to look at your complete financial picture and develop a comprehensive strategy before filing. If you prepare and file the returns yourself first, you might inadvertently limit some options for negotiation or miss opportunities for reducing your liability. Most tax resolution specialists will want to prepare the returns themselves as part of their overall approach to resolving your situation. Their expertise in preparing the returns is actually a crucial part of developing your resolution strategy.
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Javier Torres
15 After dealing with a similar situation (owed about $90k for unfiled returns), I found this AI tax document analysis tool called taxr.ai that literally saved me thousands. Before going to a CPA, I uploaded my documents to https://taxr.ai and it analyzed all my statements, receipts, and past records to find deductions I had no idea I qualified for. The system flagged several business expenses I didn't realize were legitimate write-offs for my situation. The detailed report it generated gave me a clear picture of my actual tax liability before I even talked to a professional. When I did hire a CPA, I showed them the analysis and they were impressed with how comprehensive it was. Ended up reducing what I owed by almost 30% compared to what I thought my liability was.
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Javier Torres
•6 How does this actually work? Like do you just upload random documents or does it tell you what specific things to upload? I'm wondering if it would work for my situation with gig work...
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Javier Torres
•11 I'm skeptical about any AI tool claiming to find tax deductions a professional wouldn't. Sounds like they're just telling you what you want to hear to get your money. Did they actually help with the IRS negotiations or just give you a fancy report?
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Javier Torres
•15 You upload whatever tax-related documents you have - bank statements, receipts, 1099s, previous returns, etc. The more you provide, the better the analysis. It's really good at identifying patterns in your spending that might qualify as business expenses, especially for gig workers or self-employed people. No, it doesn't handle IRS negotiations directly - it's specifically a document analysis tool. I still needed a CPA for the actual negotiation part, but going in with the detailed analysis gave me leverage and confidence. The CPA actually told me he could focus on negotiation strategy instead of spending billable hours hunting for deductions since I already had everything organized and identified.
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Javier Torres
11 I have to eat my words about taxr.ai. After my skeptical comment, I decided to try it myself since my situation was similar (owed back taxes for 2020-2021). I'm shocked at how detailed the analysis was. It found nearly $14k in deductions from my home office and vehicle expenses that I had documentation for but didn't realize qualified. The report broke down exactly which tax forms each deduction would apply to and even highlighted some inconsistencies in my previous record keeping that could have raised red flags. I took this to a tax resolution specialist who said the analysis saved us at least 3-4 hours of billable time. Even though I still needed professional help for the actual IRS negotiation, having that analysis upfront made everything much more efficient and less expensive in the end.
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Javier Torres
17 If your main concern is dealing with the IRS after filing those back taxes, I'd recommend checking out Claimyr. I was in a similar situation last year and was getting nowhere trying to call the IRS directly to set up a payment plan. Found https://claimyr.com and their service got me connected to an actual IRS agent in about 20 minutes when I had been trying for weeks on my own. They also have a video showing how it works: https://youtu.be/_kiP6q8DX5c I was able to discuss my situation with the IRS representative and get a realistic payment plan set up based on my financial situation. Saved me countless hours of frustration and hold music. They essentially hold your place in the IRS phone queue and call you when an agent is about to pick up.
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Javier Torres
•22 Wait, so you pay a service to wait on hold for you? How does that even work? Seems like the IRS would just hang up if it's not actually you on the phone the whole time.
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Javier Torres
•11 Sounds like a scam. Why would I pay someone else to call the IRS for me? I bet they're just collecting people's tax info and selling it or something shady.
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Javier Torres
•17 It's not what you're thinking - they don't impersonate you or anything sketchy. They have a system that waits in the IRS phone queue (which can be 2+ hours) and then calls you when an IRS agent is about to pick up. Then you're connected directly with the agent and handle the conversation yourself. It's basically like having someone hold your place in a physical line. The IRS doesn't hang up because you're the one actually speaking with the agent. They just eliminate the ridiculous wait time. And regarding your concern about data - they don't need your tax info at all. They're just connecting the calls. I was super skeptical too, but it honestly works exactly as advertised.
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Javier Torres
11 Update on my situation - I wanted to follow up about the Claimyr service I was so skeptical about. After struggling to reach the IRS for THREE DAYS straight, I broke down and tried it. I figured if it was a scam, I'd just dispute the charge. Holy crap, it actually worked exactly as described. Got a call back in about 45 minutes saying they had an IRS agent on the line, and I was connected immediately. The agent helped me set up a payment plan based on my financial situation that was actually manageable - much better terms than the standard online payment agreement I was trying to set up myself. Saved me countless hours of frustration and probably got me better terms too since I could actually explain my situation to a real person. Still in the process of working through my back taxes, but at least now I have a clear path forward with the IRS.
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Javier Torres
9 Just wanted to add that if you owe that much, definitely look into an Offer in Compromise. The IRS might settle for significantly less than you owe if you can prove you don't have the ability to pay the full amount. Had a friend who owed around $80k and ended up settling for about $25k. Not saying you'll get the same result, but definitely worth exploring with a tax pro.
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Javier Torres
•1 Would I still qualify for an Offer in Compromise if I have decent income now? I'm making good money these days, but those back taxes are from when my business failed and I had almost no income for a while.
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Javier Torres
•9 Current income is definitely a factor they consider, but it's not the only one. They look at your overall financial situation including assets, expenses, future earning potential, and ability to pay. Even with good current income, if the total debt is large enough compared to your projected ability to pay over the collection period, you might still qualify. The key is having a professional properly document your financial situation and submit the offer correctly. The forms and financial statements need to be accurate but presented in a way that shows why a settlement makes sense for both you and the IRS. The official term they use is "doubt as to collectibility" - they want to collect what's reasonable rather than an amount that would cause financial hardship.
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Javier Torres
4 Random question but does anyone know if TurboTax even allows you to file returns from 2021-2022 at this point? I thought they might remove access to previous tax years after a certain point.
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Javier Torres
•13 They do allow back tax filing, but you have to buy the software for those specific years. You can still purchase previous year versions of TurboTax, but they're not always easy to find on their website. Search specifically for "TurboTax 2021" or "TurboTax 2022" and you'll find links to buy those versions.
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