NYS Tax Woes

March 2, 2015 6:23 AM

I apparently owe NYS $7,000 with interest and penalties. Do I call them to tackle this myself or should I find a accountant in the morning?

I didn't file my NYS taxes in 2008 and 2009. I was young and had my first job. The $7,000 includes $2,200 in penalties. Do I have any chance in getting those penalties reduced? Payment plans? How painful will this be?

If I do need an accountant. Do you have any recommendations in manhattan?

posted by anonymous to Work & Money (9 answers total)

Get professional help. An accountant at minimum. Navigating this situation is complex. One mistake, and you may have to deal with this again at some point. It is important that this is done correctly.

The IRS frequently reduces penalties for people, but there is no way you can know if you are eligible for a penalty reduction until a professional looks it all over.
posted by Flood at 6:51 AM on March 2, 2015

I don't know about working with the state specifically, but in my experience the IRS is extremely happy to talk to you when you're actually seeking to rectify a problem. The government likes getting paid and everyone I've dealt with at the IRS has been helpful and friendly. I assume your experience would be similar calling the NY state folks.

If you can make steps to pay what you owe (especially if you can pay it off on one lump) ask if they can waive penalties and interest for you.
posted by phunniemee at 6:54 AM on March 2, 2015

Have you filed your returns for those years yet? Or did you just receive a notice of proposed assessment?

You'll want to file your returns for those years - you can do this yourself or enlist professional help (you may/will have trouble finding someone with availability before April 15). You may owe less than what they've stated.

There are payment plans; they do sometimes abate penalties, but not until the full balance is paid. The first step though is to make sure the amount they say you owe is the amount you actually owe.

You can get your income transcripts from the IRS , if you no longer have your paperwork.
posted by melissasaurus at 7:37 AM on March 2, 2015

I'm currently on a repayment plan with NYS for back taxes. My situation was slightly different from yours, as I filed for those years but was unable to pay the amount due. I'm going to second (third?) the advice to make sure you've filed for those years - not only because then you'll know exactly what you owe, but also because they can't set up a payment plan unless the return has been filed and processed by them. If it's not in their system, they can't help you pay it.

I can tell you, though, that the folks at the NYS tax office were super-nice and more than willing to set up a payment plan I could actually afford. It take a bit of time to set up - you'll be on hold for a while, of course, and then there are some questions you'll need to answer - but it's relatively painless.
posted by okayokayigive at 7:50 AM on March 2, 2015

SJ Tax Associates on 19th Street are very nice and knowledgeable and helped me with federal and NYS payment plans, often working the phones with the authorities to negotiate for me. And same as above, the state tax people are totally reasonable, and were actually concerned that my payment plan was not so aggressive that I might struggle with the monthly payments.
posted by nicwolff at 8:32 AM on March 2, 2015

Make sure you get credit for any state tax withholding from your paycheck during those years. Just because you didn't file doesn't mean you didn't pay any taxes.
posted by JackFlash at 9:07 AM on March 2, 2015

I'd get an accountant, but I tend to err on the side of letting professionals handle things like this. My accountant is excellent and I will be happy to give you his contact info via MeMail.
posted by bedhead at 9:14 AM on March 2, 2015

If you haven't filed the returns for those years, do that first. I did a similar thing (didn't file a tax return my first couple of years working, let it slide until it caught up with me, even got my paycheck garnished, ugh, embarrassing) but it turned out I only owed a few hundred dollars. I did not use an accountant because I was even more terrified of accountants than I was of doing my taxes myself.

But basically, if you haven't filed your taxes for those years, the revenue folks don't know what credits and deductions you were eligible for, and that $7000 may end up being a lot less. Now, if you filed and didn't pay, or if you were self-employed and didn't have any taxes deducted from your paychecks you may be in rather deeper. But regardless, this is a solvable problem and you're going to be OK.

You can do it!
posted by mskyle at 10:07 AM on March 2, 2015

My experience with NY taxes was that they misrecorded the date of a payment and the fined me for paying late. I sent them all the info, including copies of check and bank statement, and they basically ignored it. When I got a "last notice", I sent it all again, and they dropped it. So my impression is that they are sloppy and unprofessional. My experiences with the IRS have been much more businesslike.

I'd try to find a someone who has specific experience dealing with the tax people, not just any CPA.
posted by SemiSalt at 1:07 PM on March 2, 2015