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cactusjack
Level 2

Missing Tax Forms - Elderly Parent

My elderly mother is a few years behind on filing taxes and I'm trying to complete tax returns for 2017, 2018 and 2019.  

 

She has numerous investment accounts and I've been able to get copies of tax statements for most of her investment accounts.   However, I've given up trying to get the missing statements since a few of the account representatives refuse to work with me since I'm not listed on my mother's account.  They said they've mailed the statements to my mother but I'm unable to locate them, either because my mother misplaced them or they were never sent.

 

I do have her full 2016 tax return that was prepared by a professional accountant, and there were no changes made to any of my mother's investments during 2017-19.    I have requested tax transcripts from the IRS, but haven't received anything yet.

 

Questions:

1. I'm inclined to just 'estimate' the amounts for 2017-19 using numbers a few percentage higher than the previous year (starting with the known numbers from 2016).  Is this an acceptable approach?  The investments are primarily mutual funds.

 

2. Is there a higher risk of audit if I use the approach in #1?  At this point I would think the IRS would be thrilled to get any return/payment at all.

 

3. What should I expect from the IRS transcripts?  Will they have the information I need to complete the tax returns?  Note that they'll be sending these to my mother's address, so there's a chance they will get misplaced (she is older and sometimes just throws things away).

 

Thanks in advance.

Troy

2 Replies
Critter-3
Level 15

Missing Tax Forms - Elderly Parent

1. I'm inclined to just 'estimate' the amounts for 2017-19 using numbers a few percentage higher than the previous year (starting with the known numbers from 2016).  Is this an acceptable approach?  The investments are primarily mutual funds.   Not a wise approach ... it is best to be more accurate.  If you know the brokers then see if you can set up online access to the accounts to get the missing information.  If you have not yet done so you need to get a Power of Attorney so you can speak to them ... seek an elder attorney to set this up and get her affairs in order.

 

2. Is there a higher risk of audit if I use the approach in #1?  At this point I would think the IRS would be thrilled to get any return/payment at all.  Since you have until 4/15 to mail in the 2017 return it would be best to get the information first. Incorrect or missing info can trigger an audit.

 

 

3. What should I expect from the IRS transcripts?  Will they have the information I need to complete the tax returns?  Note that they'll be sending these to my mother's address, so there's a chance they will get misplaced (she is older and sometimes just throws things away).    Income Transcripts take a couple of weeks to come in and they will have the federal info on them but not the state.  Put in a change of address form with the IRS and state ASAP  and also have her mail forwarded to your address since she cannot be trusted. https://www.irs.gov/pub/irs-pdf/f8822.pdf

 

 

cactusjack
Level 2

Missing Tax Forms - Elderly Parent

Thanks for the response.  See more info below.

 

#1 - The investments are under a family trust account with my mother as the primary trustee.  I've been able to set up online access to most accounts accounts, but a few reps just flat out refuse to work with me.   We have POA documents in place, but my mother must be disabled or incapacitated as determined by a physician, and she's not at that point yet.  She just refuses to do her taxes but just recently agreed to let me help her out.

 

#2 - No comments.

 

#3 - We've discussed having her mail forwarded, but she is still somewhat independent and refuses to allow us to take over certain things like paying bills, etc.  Her bills, etc. are getting paid, it's just the taxes she has been neglecting.

 

Thanks again.

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