Local Discussions What's happening in the Newark business community
If You Don't File, the IRS May File for You. You Won't Like Their Version.
When returns go unfiled, the IRS can prepare a "Substitute for Return" using the W-2s, 1099s, and 1099-Ks it already has. That return counts your gross receipts as income, with no business expenses, no cost of goods sold, no dependents, and usually the least favorable filing status.
The result is a tax bill that can be several times what you actually owe. The IRS then collects on it as if it were correct.
The good news is that you can still file your own original return to replace that assessment, and that often reduces the balance significantly. Has anyone ever received the dreaded SFR "Substitute for Return" and what did you do?
Posted by Jean, Irvington, NJ on Oct 20, 2026 • in Irvington NJ
Most IRS Letters Aren't Emergencies. One of Them Is.
IRS collection letters arrive in order. The CP501 and CP503 are reminders. The CP504 warns that the IRS intends to levy and can take your state tax refund.
The one that matters most is Letter 1058 or LT11: Final Notice of Intent to Levy and Notice of Your Right to a Hearing. From the date on that letter, you have 30 days to request a Collection Due Process hearing. That hearing is your strongest appeal right. It goes to the IRS Independent Office of Appeals, and it generally stops levy action while your case is pending.
If you miss the 30 days, you lose Tax Court review and the automatic hold on collection.
Don't put IRS letters in a drawer. Read the notice number in the top right corner.
IRS collection letters arrive in order. The CP501 and CP503 are reminders. The CP504 warns that the IRS intends to levy and can take your state tax refund.
The one that matters most is Letter 1058 or LT11: Final Notice of Intent to Levy and Notice of Your Right to a Hearing. From the date on that letter, you have 30 days to request a Collection Due Process hearing. That hearing is your strongest appeal right. It goes to the IRS Independent Office of Appeals, and it generally stops levy action while your case is pending.
If you miss the 30 days, you lose Tax Court review and the automatic hold on collection.
Don't put IRS letters in a drawer. Read the notice number in the top right corner.
Posted by Jean, Irvington, NJ on Oct 13, 2026 • in Irvington NJ
Payroll Taxes: The IRS Debt That Goes Through Any Business Structure to Reach You.
When you withhold income tax and Social Security and Medicare from your employees' paychecks, that money was never yours. You hold it in trust for the government. If it isn't paid over, the IRS can assess the Trust Fund Recovery Penalty against any "responsible person" personally, for 100% of the unpaid amount. That includes owners, and it can include officers or anyone who decides which bills get paid.
LLC, S-corp, C-corp: the structure doesn't matter.
Using payroll tax money to cover rent or inventory can feel like a short-term loan. It's the most expensive loan you'll ever take.
When you withhold income tax and Social Security and Medicare from your employees' paychecks, that money was never yours. You hold it in trust for the government. If it isn't paid over, the IRS can assess the Trust Fund Recovery Penalty against any "responsible person" personally, for 100% of the unpaid amount. That includes owners, and it can include officers or anyone who decides which bills get paid.
LLC, S-corp, C-corp: the structure doesn't matter.
Using payroll tax money to cover rent or inventory can feel like a short-term loan. It's the most expensive loan you'll ever take.