They are coming after her now. She has some savings which is mostly from Social Security, and all the rest of her money is in her retirement account. Will they be able to take her retirement account? She needs that to pay for memory care. I'm her daughter & POA.
There was absolutely no criminal neglect here. She was very meticulous about everything up until about 2015 when everything started falling away and nobody knew what was going on until all the damage was done. When I found out, I stepped in and shut down her business.
I know I need to see a lawyer with her but just wanted to bounce this off of you all and see if anybody's been in a similar situation or if you know if the tax agencies will be able to take her retirement account to satisfy the debt.
Many thanks to you, the social workers, the psychologists and the many other people who help just because they can!
Tacy’s advice is great. Collect up all the information you can, before you start incurring bills from accountants or lawyers. My suggestion mirrors Tacy’s about building a relationship with an individual in the Tax Department. Start while you are flustered, worried, at a loss about what to do etc – you want them to feel sorry for you, which is fully justified. I messed up our farm tax for about four years (in spite of being an accountant, though not a tax specialist). I was distraught. The wonderful lady in the Tax Office sorted out all my old returns and explained it to me. It cost me nothing besides the amount we should have paid in the first place. I hope that you have good luck too!
It helps so much to know that there are people here who are so understanding of this situation and willing to help - it really makes me feel like there might be a light at the end of the tunnel!
My next step is to get on the Ohio Business Gateway portal. I do have her login information, I know you told me to set up my own but my financial POA includes all business stuff too; would that give me the ability to log on with her credentials legally?
Perhaps write an affidavit about all your remembrances of the start of her symptoms. Ask other family member or business associates to do the same.
With a tax attorney, and armed with your mom's earlier spotless business records, affidavits to the start of her symptoms, your mom's medical records, and dementia information, perhaps the IRS can help you get her tax records sorted out to the IRS's satisfaction with a minimum of fees/fines.
The people at the IRS have families too, and being prepared with data that what she did was not the purposeful act of a felon but a person who was undergoing a disease that she didn't understand might go a long way to a satisfactory conclusion. Best wishes to you. *hug*
The IRS is not going to waive any taxes. You may get penalties and fees lowered, but this money belongs to others and now that they know, it is going to cost her.
I would be thankful that she has the money to pay. I would check with the P/R company. I can't wrap my head around them holding this money and not making deposits. They worded that in a way that leads me to believe that they have the money and were waiting for quarterly reports? BUT 3 years they didn't deposit money, sounds like they have some culpability for this mess.
Find a good business tax attorney, they will be able to help get this sorted out, get records and maybe go after the P/R firms liability insurance, to continue to withhold taxes and not make deposits is criminal. You know she was paying them, the time frame involved proves that.
Best of luck, what a mess.
Edit: if you tell the IRS you were fighting for years for a dementia diagnosis, they are going to question why someone wasn't checking on things if you knew she was in need of a dx. I wouldn't say that, I would say we had no idea until we found out how messed up everything is and now that the dr has dx dementia we understand how things arrived here, now we need help fixing everything. Just my opinion.