My parents owe quite a bit of back taxes. Stepfather inherited, long story short, owes around $200K. Lien on home.
They pay $7K/month and are still charged penalties and fees. Is this legal? Is this negotiable?
They are not the most savvy couple regarding money management, but I would assume hiring a tax attorney would help this situation, as would applying for a loan to repay and refinancing the home.
Any info much appreciated!
What country/state? Is this US federal tax?
Zahari said:
What country/state? Is this US federal tax?
USA—I believe the taxes originated in CA.
Zahari said:
What country/state? Is this US federal tax?
USA—I believe the taxes originated in CA.
The taxes are on property that was inherited? Was there tax due by the person from whom he inherited the property?
Ok—taxes were on inherited income. If repayment is at $7K/month, are fees and penalties still applied?
Lior said:
Ok—taxes were on inherited income. If repayment is at $7K/month, are fees and penalties still applied?
You probably already had this answered, but yes, interest will continue to accrue. Failure to pay penalties will cap at 25% of the unpaid tax. Private lending options are almost always the better course and possibly settlement if the circumstances permit it. $7K a month is steep, even on a $200K debt.
— JAM
Lior said:
Ok—taxes were on inherited income. If repayment is at $7K/month, are fees and penalties still applied?
What kind of inherited asset did they get that is taxable?
Everything is negotiable from a position of strength. For most tax attorneys that can negotiate your tax liability down, that difference is their profit and most people won’t see it until much later if at all.