Tax Law (Questions About Taxes)/My company

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Question
Hi-

First off, thanks so much for taking the time to read this.
To spare you a really long story:

I am a 37 year old male who owns a very small finance consulting firm in NYC (and S-Corp).
I started in 2008, but only started earning any money in 2009.
Finance, as I am sure you know (and particularly form the servicing side) has been decimated.
I have earned maybe $250k in the past 4-5 years, which has barely kept me alive in NYC.

I have yet to pay a dime in taxes.
Why?

two reasons:

1) I simply have not mad eneough money to pay my bills and therefore refrained from paying them the first year, the bad times continued, and the cycle continued.
2) I was diagnosed with an Autoimmune disease in 2008 and I have spent a FORTUNE finding that out and dealing with it (as I had no health insurance for some time)
3) most importantly-two BIG deals that I closed over the past year and half fell through (one firm was shut down by FINRA, the other refuses to pay me dues to cash flow issues and I dont even have the money to sue them!) Its about 300k total...

I work out of my 400sf apt in Manhattan and only recently have become healthy and business is starting to pick up.

I AM TERRIFIED.

I do not have the 100 or so grand to pay the IRS (as this is what I am guessing I owe) and I am barely making my bills.

I simply do not know what to do here.

Do I call the IRS and just be honest with them and tell them my situation and try to work something out? Do they even care?

I would get a lawyer but I cannot afford one right now.

I am so worried about this that I am not sleeping at night and it is just making my health worse.

Any help/guidance you could provide would be most appreciated.

Thanks again.

Steve

Answer
You are in a tough spot.

There is nothing that you can do that will make it easy. It will be entirely up to you. No one including me can manage your situation for you. Hiring an attorney without a critical path predetermined for the attorney to follow would be an entire waste of money. What can they do for you when no litigation exists?

You have a complicated situation which cannot be mapped out with any certainty to the very end, and a myriad of plays that may or may not work for you in your specific situation.

What you need is to know the plays and then get in and orchestrate.

The path you take will depend on where you want to end up.

Here are your upsides: you own nothing therefore you have nothing to lose. Other than your continued and future revenue. While an IRS Lien may hobble your ability in your field. You are along way from that.

Have you filed tax returns for those years?
  If not, then you haven't even started the clock that would allow you at some point to file bankruptcy.
  
Tactically, I'd spend all the time perfecting a defense before you wake the giant, but don't wait because the giant can wake up on his own.

It appears to me that your golden goose is your business. That needs to be protected. Once that is safe harbored then you can plan how to deal with the problem.

Call me.

Richard Fritzler
800 658-5105

Tax Law (Questions About Taxes)

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Richard Fritzler

Expertise

Specializing in Business and Corporate taxation. Comparing the advantages and requirements of different business entities, such as Sub-S Corporations, LLC`s, Partnerships (Both Limited and General), Doing Business as a Sole Proprietor, or Using a C-Corporation. Issues regarding K-1 distributions, 1040, schedule C, 1120, 1120s. Are you considering domiciling a Corporation in a low tax state? I can review the benefits and misinformation that exists.

Experience

I have been in the business of assisting business owners in reducing their taxes and liability since 1986.

Organizations
National Small Business Owners Association.
Publications
Contributing author to "The Corporate Standard Newsletter".


Publications
Contributing author to "The Corporate Standard Newsletter".
Ezinearticles.com articlesbase.com

Education/Credentials
I have been in the business of assisting business owners in reducing their taxes and liability since 1986.

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