Can't Pay My Taxes by October 15th? What To Do

Today we're going to be talking about what to do if you owe the IRS and still need to file your taxes before October 15th. You're panicking. You're not sure what to do. And some of you may already owe the IRS from this year. We're going to help you out here, too, as well. October 15th in just a few days is the final deadline to file your taxes for 20, 23. 20 million Americans filed an extension. Maybe one of those. Are you. It was me. I still haven't even filed my tax returns. I'm going to be working on them over the weekend. It's okay. You actually reduce your chances of an audit by extending. But the deadline is October 15th or all hell breaks loose. So that's what we're talking about today, what to do. And I know some of you are like, I can't pay, so I'm not going to file. We're going to talk about that now. My name is Mark Kohler. I'm a CPA attorney, best selling author, podcaster, YouTube personality, working in the tax and legal industry for the last 25 years. I'm a business owner. I've owned some rental property. And guess what? I've been on a payment plan with the IRS too. It happens to the best of us. I've got some important, important strategies to implement here that will keep you out of hot water and save you money. Now, before I get you, give you the steps, before I give you the steps of what to do if you still owe the IRS right now for this year or you haven't even filed yet, I want to give two recommendations. One, stay calm, please. And I know it's scary right now. The IRS will ever, rarely, rarely ever foreclose on someone's home and take it and very rarely ever, ever throw someone in jail for not paying their taxes. They're going after the cheats and those that are evading taxes or criminals. Now, they're going to be on your butt, that's for sure. And they're going to want to get paid. And the penalties and interest can add up. But first of all, they're not going to come break down your door like in Christmas vacation with Chevy Chase. You're going to be okay. And they're not going to take your house. Now, they could garnish wages or hit your bank account for sure. Again, they want their money. But I also want to let you know it will all work out. There are payment plans and ways to get this taken care of so you can move forward. Living in America is amazing. And there. And I know that things are tight right now and so many of you are unable to pay your taxes, but there will. The sun will come out tomorrow. There will be a future for you. I've been doing this for 25 years and helped so many clients, young and old, professionals that make millions that still owe the irs. Just the basic small business owner that's trying to scrap together two nickels. We've all been there trying to pay the irs. It doesn't matter how many zeros involved. It hurts all of us when we don't have the money to pay. So stay calm. Stay with me here. I've got a great podcast. I've got ongoing YouTube videos and ways to build your wealth and all that good stuff. Sometimes we got to get out of debt, get on a debt snowball and get, take, take care of the irs. But then we can make our American dream come true. So have faith and be calm. All right, now, number one, first thing you need to do, and this was gonna be number two of my two things I wanted to say before, but I'm gonna make it number one. Number one that you've got to do no matter what, if you owe the IRS is file your tax return by next Tuesday the 15th. If some of you have still not filed your tax return and you're watching this video five months from now, the first thing you've got to do is file. Let me tell you why. This will blow your mind. I was so shocked. I didn't even know this until I was a lawyer. Like two years and a tax lawyer. Nonetheless, the IRS penalty for not paying Your taxes is 10 times less than not filing your tax return. Let me say it another way. The penalty for not filing your tax return is 10 times more than not paying. Now, some of you may already have some questions. If you're following me here on YouTube or Instagram, Facebook, LinkedIn, please type your questions down below. I know I've got tax advisors and financial advisors around the country that are watching as well. One of my greatest assets in this area of IRS resolution, Farah Sala. She was on a show with me yesterday talking about the IRS relief for those that are being affected by the hurricane. I will talk about that IRS notice here in a minute as well. She's in chat. She will help you out on YouTube chat. If you need to get over to YouTube chat, I've got experts in there that will help you answer these questions. So, number one, if you owe the irs, it's still okay to file. It's still. Okay, guys, this is like going on that date with that guy or girl, the first date, and you promise them you're going to call them the next day and then you ghost them. What happens? You get your car keyed, right? Yeah. Someone's going to go scratch your car because you were a jerk. Well, the irs, they're like that first date, they're just like, stay in to stay informed, Keep us informed, stay in touch. If you don't file with the irs, they assume the worst. I don't care if you owe the irs, you're going to still owe them whether you file or not. But if you keep them in the dark, they're going to nail you for 10 times more in penalties. And what it is, is it's 5% of what you owe every month. So if you owe and don't say you owe 10 grand to the IRS and you don't pay, that's cool. It's a half a percent penalty. You, you don't file, it's a 5% penalty every month. That's $500 a month. And it starts to add up. And that's on top of interest. So number one strategy is in the next six days, go to a strip mall, get on TurboTax, go anywhere. And if you're like, Mark, I don't have all my records or my documents. Guess. Do your best at guessing. It's better than not filing. It's okay. If they're not perfect, get them off in the mail by October 15th. All right. If you think you owe, it's obviously why you're freaking out and can send anything in with your tax bill. Do it. Send $100, send $500. Whatever you send, you're going to save penalties and interest on. So if you can send anything in, that's step number two. Number one is file. And number two, send in what you can. Anything is better than nothing. Now, let's talk about the hurricane victims of Helene and Milton. The IRS just released a notice a week ago and said, anybody affected in seven states. And I'll go through them right here. If you've been affected by the hurricane Helene, primarily Milton, we're going to still see what's going on there. You can take until May 1st to file your tax return. Now, if you owe, you still owe. But remember, owing is not as bad as not filing. So if you were in Alabama, Georgia, North Carolina, South Carolina, Florida, Tennessee, or Virginia, you've got to go to the IRS website, type in your county, and see what the deal is for your county if you're in the list or not. If you are, you don't have to file by October 15th. You can wait until May 1st of next year. You're still going to have penalties for not paying, but this penalty for not filing, it's not going to be there until May 1st. So if you want to get filed, that's great. But a lot of people affected by the hurricane and our hearts go out to you. You can, you probably lost your tax records or can't even get to your house or who knows what you've lost. Trying to file your taxes is the last thing you're worried about. So you have until May 1st. Now, by the way, a couple other things in that IRS notice. If you have Q4 fourth quarter deposits as a small business owner or first quarter deposits, you can wait until May 1st to make those deposits. And also for your 2024 tax return, you have until May 1st to file an extension of your tax returns, not April 15th. So anybody in these seven states affected by the hurricane, you got till May 1st for any IRS filing. Now, as for the state, you got to find out what the state's throwing down. But that's what the IRS. All right, so number one, you're going to file by October 15th, unless you're in one of these seven states and you've got to pass. Number two, you're going to estimate what you think you might owe and do your best on your tax return, even if it's not perfect, and send in what money you can. Now, your third step, this is super important. You're going to call the IRS and ask for a 30 to 60 day hold on collections. You're going to say, hey, give me 60 days to breathe. It's called a 30 or 60 day hold on collection. You can call up the main number 1-800-849-1040, I think call up. By the way, it's the same on hold music for the last 25 years. But call them up and say, I need this. You need the collection department. And you're gonna say, I need a hold 30 to 60 days. Now why you're gonna do that is it gives you a game, a time to build a game plan. You might want to do an offer. You might want to contest liability. You bet you we're gonna. Which are very rare. Those are gonna work. And I'm gonna talk about the scams there. But when you get this 30 to 60 day hold, it gives you an opportunity to make a game plan. We're going to see if we can get all your returns filed and figure out what's best to how to get this bill paid. Now, an important note, everybody. This is so important. The IRS will never call you on the phone. Never, never. If anybody calls you and tell your kids this, tell your mom and dad or grandparents this, because there's so many scam artists out there, the IRS will never call you on the phone. I've had them call me and I've been like, hey, you owe the irs. We're IRS agent, whatever. And you need to send us money right away or else it's going to get ugly. And they try to scare you, hang up, don't fight with them, don't call them losers. You never know what they might try to do to you and your identity. Just, oh, thank you, bye. The IRS will never call you. Also, the IRS will never email you. They will never, ever email you. These are scam artists. The IRS is going to send you mail. And don't put it in a shoebox in your closet. Open it up and deal with it. As soon as you can deal with mail from the irs, the better you call them. Now you know you're not, you're not getting scammed. IRS mails you. They will not email or call you. All right? Now once you're in this 30 to 60 day period, you're going to make a game plan. This is where you're going to see some radio ads, AM radio ads, whatever. If you listen to AM radio still and you're going to see people call you or who knows what that are going to offer you a deal, they're going to say, hey, you can settle with the IRS for pennies on the dollar. It's going to be amazing. We just need to check for 3,000. Give it to us, not the IRS, and we'll get you deal. You will get rid of all your tax debt. 90% of the time. It's a scam. And by the way, only 40 to 45% of offers even go through. And 90% of people, you don't even qualify for an offer. But these scam artists will take your money and tell you they can get you a deal. And now you've got pain and suffering on top of owning the irs. Please just get a local CPA that does IRS resolution work. Now I've got several tax advisors that are in my network all over the country. I've got 700 advisors all over the country, but a number of them right now in chat that will help you out. They'll give you an Email address. You can email and interview them. Go to their website. Make sure they're certified by Mark Kohler in the Main Street Tax Pro network. You can go to my website, markjkohler.com, go to the network and you can search for anyone that does IRS resolution. Interview them. You're going to pay them a very nominal fee or per hour to get that initial consultation and make a plan. Find someone you can trust and be careful of any of these big national companies that are offering you crazy ideas that I know sounds so good, but there are oftentimes and many times scams. Now I'm going to take your questions just here in a minute, type them up. We're going to fill them as quickly as we can. But I want to say one more, two more things. Now once you're past this 30 to say 30 to 60 day period. Next, what you're going to do, I think this is number four. Try and find the money. Borrow from your 401k, borrow from your house, borrow from a family or friend. Sell your boat, sell your rv. The penalties and interest add up so quickly with the irs. Get the IRS dealt with and then go buy yourself a new boat when you're financially capable or an RV or whatever it is. So many of us Americans have crap in our basement, the closet, the garage, outside to the house that we don't use. People. If you owe the irs, it could be a downward spiral and take you where you don't want to go. Sell the crap you're not using. Pay off the irs, get your life in financial order and we'll get that stuff back. Now final if you can't dig up the money. Last point number five is you can do an installment agreement with the irs. Very easy to do as long as you're current filing. You've got all your tax returns filed for the last six years. They will automatically accept an installment agreement under $50,000. Put you on a payment plan. That's one of the best things to do to at least get this behind you and start having that regular payment plan. And I've had clients that are very successful. I've been on a payment plan before, about 15 years ago, 20 years ago. And it was okay, I just made my payments. That's okay. Don't shame yourself, don't be embarrassed about it. Talk to people, say I'm on a payment plan with the irs. Own it, get that thing paid off. They don't even care if you prepay it. Pay it as soon as you can. But an Installment agreement is not great because it's an 8% interest rate. And by the way, interest will continue accrue as well. So you got to get this thing taken care of as fast as you can. So get an installment agreement as the last resort. Those are my steps. And again, the biggest thing is keep your head above water here. Don't put your head in the ground and say, I'm going to ignore this. I'm going to just hope it goes away. It won't. It'll only get worse. Don't beat yourself up. Don't shame yourself. Talk to it about. Talk about it with your family, your partners, your friends. Reach out for help. Get with one of our tax advisors or someone and be careful of the scam artists out there. You can do this. You can dig yourself out of this hole. Well, the rest of the time is yours. I want to just answer any questions that might help you in this situation. Dana in the studio, what do you got?

Well, I got a new camera that shows me. Hello, everybody. Our first question is for senior citizens such as parents on Social Security. What is the best way to file over the weekend? Any companies offer last minute assistance? Some places are charging up to $500 to file last minute. What are some good options?

You bet. The first option is if you have a very simple situation, Social Security, a W2. You don't have any rental property or a small business. Just go to Slayer. I love Tax Slayer or turbotax, some of the favorites that I like, Tax Slayer, I worked with them a lot over the years. Love them, they're out of Georgia. Or Turbotax, the 800 pound gorilla out there. But just get online, get an account, input your information. It's easier than you realize. If your tax situation is simple, can be very affordable, and if you're wrong, you can always amend it later. But just get it filed online. Service number two, shop around. You might be able to get a Liberty Tax or an H and R block. If they're saying it's $500, call around and even call some other local accountants and say, hey, can you do it for. And tell them it's a very simple return. It's a 1040, which is Social Security and a W2, please. So don't get ripped off. Now, I'll tell you, $500 to file a personal return is not terrible. Most accountants, they can't keep the lights on if they're doing these things for 100 bucks. So go do it online yourself. But again, $500 might be cheap if you've got a totally complex return too. So shop around. But you should be able to get some of this weekend to do it. And especially on TurboTax or tax layer. Next question.

So the next question is somebody pointed out and I wanted to see what you and maybe Farah in the chat had to say about it. They said the IRS will call when the revenue officer assigned to your case cannot make initial contact with you at the last listed address within 45 days of receiving your case.

Okay. If you're an actual appeals with a revenue officer, I'm going to be talking to the IRS on the phone. I'm going to call them. They're going to call me. Once you have a case with the IRS and you're that far along in the appeals process or but it is very rare in collections that they're ever going to call you. And especially if you just owe the IRS and someone calls you out of the blue. Now, Farrah, I would love to hear your comments and chat on that. If you see a response, Dana, let us know. But the best case scenario is always call them. And unless you've got a relationship with an IRS agent that you've already been engaged with a revenue officer on paper in an appeals case. Okay, fine. I get it. That's not the scams that are out there.

So, Danan, next question. If I file on October 15, how long do I have to amend my return?

Three years. Three years. So now that's assuming you filed a valid extension. You have up till three years from the due date or your extension due date. Three years to amend your tax return and you'll be. Yeah, there you go.

Another question is, can we quickly just go over those steps that you shared?

Oh, yeah, let's summarize them. Okay. Number one, always file your tax return as best you can. Sorry. And that's going to include. Okay, number one, always file. Number two is prepare and estimate your return to find out what you think you might owe and send in what you can. And don't worry if it's not completely accurate. That was point. Number two, prepare what you can, estimate what you think you owe, send in what money you can. And if you have to send in zero, that's still cool. But step two is try to do the best you can to send in a few bucks and even estimate what you think you owe in that process. Number three is you're going to ask for that 30 to 60 day hold on collection by calling the IRS yourself. Number four, you're going to try to find what money you can to try and send in whatever because we don't want to do an installment agreement if we have to. And that's number I'm going to put. Oh, I'm going to put it as number five. I think I got four and five out of order. But if you're going to do an offer and cut a deal with the irs, just realize there's a lot of scammers out there and you want to find a professional you trust. And then number six, do the installment agreement is last case. So always file. Estimate what you think you might owe, send in what you can. Number three, call the IRS, ask for 30 to 60 day hold, make a game plan. Number five, cut a deal with the IRS through an offer if you think you qualify. But careful of the scam artists out there. Number six, find the money, send it in. And number seven, installment agreement. I've added one somewhere in there. You guys get it, I think. Is that one of the offer? I just don't think an offer and compromise is that common by any means. It's not. So be careful with that. And then you're going to go with the installment agreement at the end of the day and just get on an installment agreement plan. Even if you don't like the interest rate, it's better than nothing.

Next question, Dana, Next question is, I haven't filed because I'm bad at prioritizing my stuff. I'm two years behind. I don't owe. But I started a small business in 2022. Will that work against me doing my taxes, claiming my business expenses?

Okay, a lot of you. Okay, so this person here says, I haven't filed in two years, but I don't owe. The first point I want to make is, are you sure? So you've got the tax return all done. You pulled a transcript from the IRS to think to find out what they know about you. And you've got valid expenses for your business. And a lot of people think, oh, I had a loss in my business or it's going to wipe out my income over here. I'm not trying to be rude, but a lot of people think they don't owe and they do. So freaking A. Get the returns done and file. If you don't owe, then great, prove it and get this issue off your back. You never know and it could be adding up. Number two, do you know every year a billion dollars is unclaimed by people that were due a refund? If you don't owe, you probably have a refund. It's one or the other. Either you owe the IRS or they owe you. That's 90% of the time. Rarely do people not owe and not aren't getting a refund. That's very rare. So you could even have money sitting on the table you could be using in your small business. Holy hell. A billion dollars a year people leave on the table and the IRS gets to keep. Now you have three years to file. So if you have not filed in two years, that money that you might be due is still sitting there. Once you hit the third year, by the due date, you lose it. If the IRS owes you money, you lose it. So everybody freaking file. It's better than not worrying about this. Good luck. Next question.

Okay, I'm going to change it up just a little bit so I actually have a follow up question about that.

Okay.

Because I'm in a very. I'm a fairly similar situation myself with as with Lou, with a company that I own this year as well as last year. I operated at a loss, didn't owe any taxes, but I didn't have any W2 income or anything like that. And so I didn't receive any taxes. Is that normal? Is that, is that not normal or not?

What's not normal?

To not owe and to not have any refund. So straight zeros.

Okay. So what's interesting here is, is that someone will say, well, I don't owe because I had a loss in my business and I just said if you don't owe, you might be owed a refund. Okay. Do you have children? Do I have the earned income credit? Do I have the child tax care credit? There's credits out there that you can get even if you didn't have a W2. And sometimes I'll take a client that's got a small business and. And I won't take all the write offs because if you show income, now I'm getting the earned income credit. Showing income can get you money back. It's called welfare. I mean, it's a form of welfare is that I can get the earned income tax credit, so I want to show income. Not having a loss isn't always the best thing. You might be trying to buy a home, you might be trying to rebuild your credit. La la la la la. So you want to strategize that and talk with your accountant. And sometimes you don't want to take all the write offs in your business because it gets you a credit somewhere else.

So what I'm hearing is don't necessarily do it all yourself, as I did if you own a business.

Yeah.

And have kids and everything like that.

Exactly. And I'll say it a different way. If you've got a small business, you've got kids, you own a home or, you know, but you're on the border of showing profit or not, that's the best time to get a tax advisor to say, hey, let's. Can we game the system here. Is there a tax credit that I might be due if I do my business taxes in a different way? Just slapping it out on TurboTax. Oh, yeah, I don't know. You may have. You could play with it if you know what you're doing and be honest. See, here's the thing. You're entitled to every write off to your small business. But does that mean you have to take them? No, you can volunteer to not take the write off. Some people go, well, that's weird. Then you're going to owe the irs. Yeah, but if you owe. I'm sorry, if you show enough income, the IRS might be giving you an earned income credit that offsets that. Anyway, you never know. Got to play with the tax return. Get it. Get over to markjkohler.com, get over the TaxPro network. Interview a tax advisor that could help you prepare your return in a more creative way. And at least you know, it's over with and it's done. Okay, next question.

Okay, so we're kind of in a follow up to an earlier question when you said that $500 may be reasonable to hire for somebody to do your tax return. What is a reasonable fee for filing an S corp? Taxes?

Well, most people that have an S corporation or that could be an LLC taxed, it's an S corp. You're going to be filing the 1120s tax return. Most people that are doing that have activity. I mean, you got income, you got expenses. So we call that an 1120s. With activity, you're in business. If you have an S corp and you had no activity that year, you still need to file. So there's two situations. I have no activity, S corp tax return, activity tax return A, no activity tax return, S corp. We charge about 200 bucks. 250 bucks. That's our old accounting firm that I walked away from when I started training advisors around the country. But I think you're looking at about 250 bucks. Maybe someone knocked it out for 100 or 200 bucks. Once your S corp has activity now, it's going to be a sliding scale because the more transactions you have, the more costly it's going to be, I would say an S Corp tax return bare minimum is going to be 750 bucks, typically around $1,000 to 1,250. I've had clients that have paid 20,000 for a tax return because they had so much going on, 100 employees and all this stuff. But most, I mean 90% of the time you're going to be between $750 and 1,500 to do an S Corp tax return. That would be the typical. Next question.

All right, our next question is a bit of a departure but an interesting one. Like to hear your thoughts. Hi Mark. I may be leaving my senior tech position to inherit the tax business from my retiring grandparent. Your methods seem like an awesome upgrade compared to the status quo. Where should I start?

Oh my gosh. If people, if you're looking for an income opportunity and this wonderful individual here that just messaged us saying going to inherit my grandparents business, a tax practice. Oh my gosh people, the accounting industry is on fire. There are baby boomers walking away from tax practices because they don't think they can sell them or no one wants them. And enrollment is down at universities and accounting programs. It's a travesty. Do you know how many business owners out there are starving for a good tax advisor? They're starving for them. There is so much opportunity and you don't have to be a typical accountant. So what I started two years ago was the Main street tax pros. And this is accountants around the country that want to level up and be a tax advisor, charge a little bit more but save their clients thousands in taxes. It's a win win. And so you have fewer clients, clients that love you and you make more money. Everybody wins. It's called tax advisory. So if you want to do a demo, get over to Main street tax Pros. It's@markjkoler.com youm can sign up for a demo. Someone in my group chat will put in the link. I have tax pros right now in the chat. Instagram and Facebook and TikTok and everywhere. But just get over there and do a demo. We are seeing our tax pros double, triple or quadruple their income. They're happier, they're more satisfied and they're learning tax strategies that actually work that move the needle. So if you're an accountant enrolled agent and you want to level up this Q4 and turn the corner and convert many of your compliance clients over to tax advisory, I teach you how, give you engagement letters, pricing models 75 strategies, 12 modules. Our tax advisory program is, is 10 grand and then 300amonth to get training every week. It's amazing. You will earn that back with one advisory client. Oh my gosh. It's amazing. So please check it out. Markjcolder.com Do a demo today. Next question.

Sorry, I got to turn my mic on. I think we'll end with just one little, I guess, fun little bit. Here is somebody mentioned that because of this video they went and checked and realized that they actually owed $500. And so we got them to check and make sure that they're all even with the IRS.

So they think they owe the IRS 500.

They found out they owe 500.

Okay.

And so they were just, yeah, commenting on that.

Here's the thing, everybody. I'm going to finish on this note. Then so many people assume they don't owe the IRS and they don't do anything. Come to find out they really did and it gets ugly. Then there's other people out there that assume they owe the IRS and they freak out and they have so much stress and they don't file because they think they owe the IRS and they're due a refund. Don't be in the dark. Don't think you do owe or don't think you don't owe. Just, just freaking file. And you can use online software at the basic level. I'm not saying Liberty Tax and H and R Block are bad by any means. They're helping the lower level clients that are super easy tax returns. Get in there, get your tax returns done and just get it over with. And then you'll know. You'll be in the know, you'll find out and you won't have any stress or a false sense of security. And any of you out there that are looking to build a tax practice want to start a tax practice. An enrolled agent, an accountant, a CPA, a tax lawyer, financial advisor. Please get over to markjkohler.com check out our tax Pro certification and become a tax advisor. Today you can make 2, $300,000 a year building a tax practice with incredible clients and not having to kill yourself 40 hours a week. You, you really can build that type of practice. It's amazing. So thanks everybody for being here. If you haven't filed your tax return file before the 15th, save yourself some heartache. And if you owe the IRS, there's lots of options. Don't stress. It'll be okay in the long run and the American dream is still alive. And real.