Expert: Richard Stolp - 3/4/2010

Question
Hello Richard,
    I was being paid in a personal check from a home construction company and was told they were withholding taxes for me and they would pay it for me. Well, I received a 1099 in the mail the following year. I ended up being liable to pay all taxes. I filed an SS-8 form (employee or contractor) and won in my favor. The IRS said they determined I was an employee. However, they still sent me collections papers saying I am liable for the tax until my former employer takes action. That was over 20 months ago since I was ruled in my favor and they keep sending me letters saying they are investigating (being a determination in my favor is not a final decision) and will let me know the results in 45 days. I received 4 - 45 day letters. Is there a statue of limitations for the IRS to clear up this matter?

Answer
Yes, the IRS is very slow. I would write a letter and explain how long you have been waiting and ask that the case be closed along with any tax liability you might have. You have a right to have your case closed in a timely manner. If you don't like the answer you receive (more delays) then I would call the Tax Payer Advocate service and ask them to help close your case since it's been so long.