Back in 2020 or so I got a notice from the IRS that I owed an outstanding balance of $10K or so in penalties. Looking into things as a freaked out college kid who didn't understand how that could've have happened, it seemed that the IRS thought my income from a 2018 1099 was $36500 when it was actually $365.00.

    The issue came from my employer submitting handwritten documents that made the decimal barely legible. I did everything I thought I needed to at the time. I visited my local IRS location, I spoke at length with representatives over the phone, and I mailed everything they asked for in terms of forms, and documentation – including a photo copy of the original form submitted from the accountant to correct the error.

    I didn't hear anything back from them and assumed everything was good to go. Obviously a very stupid mistake in hindsight. I continued to file my taxes as normal each year without any contact from the IRS. Until recently when I received a notice from a debt collector that they were trying to collect the debt on behalf of the IRS which was now $16K including interest and penalties. It appears the balance due is in the IRS system and attached to me, so it's all legitimate. I totally get that this is my fault but I just cannot believe they couldn't reach me at all about this within the last 8 years!

    My ultimate question is – did my negligence around making sure this situation was handled at the time put me in an unwinnable situation? Should I try to speak with the IRS directly or a tax attorney about this? Just not really sure where to start considering how old the tax year when this occurred.

    Incorrect Income Reported to IRS – Ongoing Issue From 2018 Tax Year
    byu/EDMSauce_Erik intax



    Posted by EDMSauce_Erik

    1 Comment

    1. CollegeConsistent941 on

      Seek professional tax help for this. Either a tax CPA or EA. You are in over your head now.  

      Would have been an easy fix in 2019 by having the issuer do a corrected 1099.

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