• I Forgot to Report Income to the IRS! What Now?

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    A few days ago I received a scary looking letter from the IRS. It said that I had not reported some income, and I owe back taxes plus interest totaling over $600. I am every bit the law-abiding citizen, and I’m a goody-two-shoes to boot, so I was completely horrified! My head spun as I pictured myself being hauled off to prison, possibly even put to work on a chain gang! My first reaction was to throw the letter under the couch and pretend I never saw it, but reason prevailed.

    Him and I made our first ever visit to a tax professional this past weekend. I brought the letter plus all my tax paperwork (thank goodness I saved all that stuff). He quickly determined that yes, I had failed to report this income. It was a complete oversight. I think that what happened was that at the time I was preparing my taxes, I was not sure where to report the income, so I set it aside for later. Unfortunately I completely forgot about it and sent in the return without it. The good news is that our new tax guy feels that we can successfully argue that the IRS is classifying this forgotten income incorrectly, so we’ll owe about $200 less than the letter stated. He suggested we write a letter explaining our case and attach a check for the amount we believe I owe.

    I spent the past night writing that letter, and boy was that nerve-wracking. I feel like a criminal! Hopefully the IRS will accept my argument and the check and settle the matter quickly.

    Has anyone else ever forgotten to report any income? What did you do about it?

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