Stimulus receivable vs Federal tax debt
I still owe over 5,000 of federal taxes (which a half of what I already paid)- uncle Sam punished me for taking my IRA money in 2017 to buy my first house.
Question 1: will I actually receive this stimulus check, or will it go to the same place where my last 2 years tax refunds went – back to uncle Sam – to offset my debt?
Question 2: is there any provision in connection with COVID19 that uncle Sam maybe stop charging me interest and penalties for my debt (you probably aware – they charge it regardless weather you pay back or not. Well I do. Yet they already charged over 1,000 as accrued interest and penalties over the course of just 2 years)
Terry Says
Whew. Yes, you will get a stimulus check, regardless of your back taxes.
And did you take more than the allowable $10,000 from your IRA to buy that first home? That’s what would have resulted in a penalty. Of course, you would owe taxes on the first $10,000, but no penalty on that amount? Did the penalty come because you didn’t declare the withdrawal on your tax return?
Depending on your circumstances and how much you owe, get a tax advisor to prepare an “offer in compromise” — Maybe you can get them to settle for $1200 — which now you will have!
