Hi all, the tl;dr is that I haven’t been able to file my mom’s taxes for 2022 or 2023 yet, although I sent in estimated federal tax due both last year and this year, along with form 4868
Why, you may ask. Well, my mom is in her mid-80’s, has memory problems, can’t really manage her own affairs since around 2020 when we finally brought her over to live with me in September of that year (because EVERYTHING had to happen that year). Sometime after that point we filed a change of address form with the USPS, we arranged for most of her accounts/assets to be in a trust that I and my siblings are in charge of etc.
As far as the taxes go, we had an accountant do it for TY 2020, then I figured I’d do them for TY 2021. No problems with that. What I didn’t think of when it came around to doing them for 2022 is that I’d never gone to the Social Security Administration to officially change her residence/mailing address with them, so I blithely filed the extension last spring (2023) with an estimated tax due amount, figuring I’d do them by the fall. Well, fall came around and I realized I didn’t have all the documents (mostly the SSA ones were missing, but others too) and I was hosed. I managed to get the address changed at the other institutions but have yet to get it changed with the SSA. Calling them is an exercise in frustration (I waited on hold for 45 minutes) and they tell you not to show up unannounced at the local SSA office, so what are you supposed to do? I’ll try calling again and see if they will call you back eventually if you leave a number.
You’d think SSA would try to track a person down when the stuff they send comes back as “not at this address” but I guess not.
In the meantime even once I get that address stuff all sorted, and the relevant missing info needed for the returns, can I even file a return for 2022 this late? Should I call my Congressman’s office for help? Do I need to hire an accountant to sort it out? Am I/she facing massive penalties?
If I were in your situation this would probably be my first step. There are just too many rules and regulations for the average person to be able to effectively handle your own taxes unless you’ve just got a super straightforward setup, no investments or property and such. I’m guessing there may be some penalties involved, late fees and interest maybe, but as bad as their reputation is the IRS will generally try to work with you to sort things out.
If the house had been sold yet already* or occupied by randos, I’d say that was the case, but it hasn’t been sold and only occupied by people well known to us, and they wouldn’t have just thrown something like that away.
*The plan is to finally sell it this year (I can’t wait till that’s over and done with).
@divedivedive Her taxes when I did them were quite straightforward. Just entered 1099-R income, 1099-INT income, a few deductions and Bob’s your parent’s brother as they say. One thing I want to change is getting it so she’s not underwithheld, because I don’t want the bother of remembering to send estimated tax payments.
Fair enough, I just interpreted your post as saying that at this point your mothers taxes might be somewhat in arrears, and might require some calculation of actual taxes (since sounds like you made a few estimated payments) in addition to any penalties. In my opinion, that’s where a tax pro could really help out.
Another not-a-CPA or otherwise anything but a random guy where taxes are concerned here, but I echo the above. This is exactly what actual tax pros are good at. They will help you figure out what needs to be done and help you figure out how to have productive conversations with the IRS, as needed, to get things square. It’ll cost a few bucks, but probably not anything super crazy. You’ll get your money’s worth.
Oddly enough, of all the federal agencies I’ve dealt with, the IRS has generally been the most straightforward. I had a problem one year where I neglected to file the right HSA form and got a notice that I owed X amount, etc. etc. I sent them a letter with a copy of the errant form, and no problem, everything was ok.
GO THERE. Seriously, do not listen to what they say about showing up in person. When my mom died I needed to get her benefits stopped (auto deposit) and notification of death (including death certificate) submitted ASAP. I went to the downtown SocSec office 45 minutes prior to when they open, stood in line with a handful of other people in the hallway outside the offices, and when they opened it took less than 5 minutes for my number to be called and 30 minutes later I was leaving with all paperwork filed, benefits stopped and advice on what to do next. Far from being the dystopian hellscape I’d been led to expect, the SocSec office was probably one of the easiest, most informative and most productive visits to a government office I have ever made.
I would also recommend you find a tax accountant/attorney who can file the proper paperwork immediately for extension of time to file for 2022 and 2023. Then that same person can go over all of the relevant documents once you have them and prepare adjusted returns for both years. At that point they can submit the returns and work with the IRS on whatever fees and penalties may apply.
Did your mom usually end up with enough income annually to actually owe taxes? If all she’s filing are the SocSec income, some 1099-INTs and a 1099-R then it sounds like the retirement withdraws are not withholding enough. Most elderly retired folks shouldn’t end up owing additional taxes on their SocSec+Retirement income unless they aren’t having the retirement account do enough withholding on each disbursement or they are taking large disbursements that aren’t being spent on medical care. The tax accountant should be able to assist with setting this up properly so that your mom doesn’t owe taxes and may even get a little back each year by setting up the disbursement withholding correctly.
I worked for the IRS for part of my life. So while not an expert I can tell you people often file returns late, sometimes very late. At this time I would agree with the above advice to find a tax accountant and have him work on getting out the unfiled returns. Interest and penalties will accrue on any taxes due. If there are refunds the IRS wants the returns but could really care less.
The IRS is still in a mess since the pandemic and the events that came with it, so calling them is probably pointless.
I recently had to make a visit to our local social security office. Online it said I needed an appointment, but when i called, and waited on hold for a hour, the lady just told me to come in without an appointment.
I would call them, put in your earbuds, and do whatever you normally do while on hold and see if you can go in. Might be a good idea to ask what days they are slow, or super packed. Oh and dont bring your pocket knife.
Oh, thanks for the reminder about that stuff. Is a nail clipper okay if it has the teensy nail file bit, or do I have to leave that at home as well?
@SlainteMhath If it was for just me, I would do the “get in line butt-ass early” thing. Unfortunately getting my mom out of the house and anywhere before about 10:30 AM is almost impossible.
The SSA is weird. I had multiple fruitless go-rounds with phone ‘specialists’ or whatever they called them. Finally went in person and got everything straightened out (correctly) in 5 minutes at the service window.
I did the ‘nearly first in line’ bit, but even if I’d had to wait a couple of hours in the virtual queue it would have been way more productive than using the phone again.
Err on the side of caution. When my newly-married wife and I went to our local SSA office to change her name, we had to lose our spot in line because she had some big metal knitting needles in her purse. Imagine it’s an airport.
Heh, I remember it being the exact same with my mom. No doctors appointments before noon and no repairmen, deliveries, cleaning people, etc. at her house before 10:30am (even then it was 50/50 if she would answer the door).
A suggestion to make life easier for you since your mom lives with you, has some memory issues already and it appears that you’re going to be the responsible sibling : Get Durable Power of Attorney for your mom.
The form is different in each state, but usually very easy to fill in yourself, no actual attorney required. You can usually download a fill-in PDF version from your Secretary of State website, your state Bar Association website or an online legal site like Rocket Lawyer. Once you have it all filled out you simply need your mom to sign it in the presence of a notary so it gets notarized, than make a PDF copy of the notarized document to provide to banks, investment funds and places like the Social Security Administration. Durable Power of Attorney essentially means your mom is granting you status to act on her behalf for all things financial and legal, and it means you don’t need to drag her around with you or have her talk to people on the phone whenever you need to deal with something with her bank accounts, insurance, investments, or legal issues like dealing with the IRS and SocSec. This status is revoked upon death though, so it’s not a substitute for a Will, a Transfer on Death for real estate, or having beneficiaries listed on said bank/investment/insurance accounts. It does make dealing with everyday stuff for your mom a hell of a lot easier though, especially if/when her physical/cognitive health begins to decline.
They have been the best federal agency I have ever worked with. One year, when our LLC for our improv group was late on taxes (because I misread the due date by one month, I thought the due date was the same as the “late” due date for individuals, but it is one month ahead) they sent us a late fee and I called them and explained, and they waived the fee as it was a “first time” mistake.
They don’t want to take money away from honest people, they just want to get the amount that is correctly owed. (Our LLC was up to date on tax payments at that point, the fee was just for being late)
