Best way to resolve a failure-to-file notice?
April 14, 2011 1:31 PM   Subscribe

Please help me figure out how to resolve, as cheaply as possible, this failure-to-file notice I've received from the Massachusetts Dept. of Revenue.

I've received a failure-to-file notice from the state of Massachusetts for my 2006 return. They are right that I did not file my state taxes that year, but they're saying I owe them the entire amount of taxes I owed that year. Can that be right? I never got that money because it was withheld by the 2 employers I worked for that year (I changed jobs halfway through), and I have the W-2's to prove it. So I don't understand how I can be expected to pay money I never received.

According to the return I filled out but never filed, I owed $1300 in taxes for the year, $850 of which had been withheld, so I should have filed $450 with my tax return. The failure-to-file notice says I owe $1200, plus $350 in interest and $600 in penalties. (I've been avoiding this for a long time because I'm confused and scared and don't know what to do).

What will be the cheapest way for me to resolve this? Is it better for me to get a lawyer, or try to negotiate with them myself, or just pay this off without disputing anything so it will go away?

And if I should get someone to help me, who should I call?
posted by anonymous to Law & Government (7 answers total)
Here's the thing: at this point, they're asking for $2,150. You think you owe $450, plus interest. If you can get a lawyer to resolve the issue for less than $1,075, and you wind up having to pay less than $1,075, you're saving money.

Your only other option is to just pay the full $2,150. Sounds like the math says a lawyer might be useful here.
posted by valkyryn at 1:35 PM on April 14, 2011

Disclaimer: I don't know anything about Mass. taxes. But I was able to get on the phone with somebody from the Maine Bureau of Taxation and resolve a problem. If there's an office where you can visit in person, even better.
posted by theora55 at 1:37 PM on April 14, 2011

They're just estimating, first of all. Failure-to-file estimates are frequently not right, but you generally don't really have to pay the estimate, you're supposed to file and then pay the amount you actually owe plus penalties and interest. Call them up to check, but as long as you have a totally correct return right there that you can just file now, they'll probably just have you send that plus the payment you originally calculated, and then as long as you've got the numbers right they'll come back with their calculated penalties/interest on the now-paid principal balance. Chances are they're just calculating based on your reported income and withholding from your W-2 and you've just got more deductions or something that they don't know about until you actually file.

But call, yeah. Although, expect them to be busy this weekend.

It's still going to be a chunk of change since it's from 2006, but don't just write them a check for the estimate.
posted by gracedissolved at 1:43 PM on April 14, 2011 [1 favorite]

This happened to me just recently in NC. I contacted my employer, they graciously dug up my 2007 W-2, and I compared the amount withheld in state taxes to the taxes I allegedly owed- the difference was $37. So I sent a letter to the DOR, including a copy of the W-2, and then a little while later, they sent a revised notice- I now owed the $37 + a few penalties, for a total of $51. No lawyer needed.

So my suggestion would be to call up the Department of Revenue, get them a copy of the W-2 that you have, and they will hopefully revise the amount you owe- the $350 that wasn't withheld will probably be what you now owe, plus penalties and interest should go down accordingly. Definitely no need to pay the full amount, since you have proof that $850 was withheld.
posted by heyheylanagirl at 1:44 PM on April 14, 2011 [2 favorites]

MADoR shoots first and asks questions later. Call them! Then file ASAP. TThen call hem again to tell them you filed. This happened to me back in 2001and I stupidly ignored their letters. They wound up levying my bank account for an assload of money. Then I called, filed then called again and they released the levy. Call before they levy! They're horny for levying!
posted by Cat Pie Hurts at 2:48 PM on April 14, 2011 [2 favorites]

Should have said, FIle, but don't send a dime. The money part will resolve after your filing is processed.
posted by Cat Pie Hurts at 2:50 PM on April 14, 2011

I totally had this happen a few years ago. Massachusetts and everything. What they were asking for seemed like way more than I owed.

It was much less bad than it appeared! The amount that they estimate doesn't take into account things like your rental deduction (if applicable) or any of that other stuff. File. Now. They will send you a bill for the correct amount once you file. I never even called, it just all worked out after I filed. (Oh, and I let it go so long and get so bad they garnished my wages - don't let that happen! It's embarrassing!)
posted by mskyle at 6:13 AM on April 15, 2011

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