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Is there any way to get my father-in-law out of his IRS bill?

A fellow caregiver asked...

My 76 year old father has Mild Cognitive Impairment and lives alone. I've been trying to move him back to my state, but I recently found out that he's burned through most of the money he has left. I've taken some control of his finances and am putting together a plan, but today I found out that he owes $80k in back taxes (after pressuring him to finish his old returns) which suddenly leaves him with only $180k TOTAL for the rest of his life... Is there any way to get out of having to pay the $80k to the IRS?? I'm scared and am not sure what to do...

Expert Answer

Steve Weisman hosts the nationally syndicated radio show A Touch of Grey, heard on more than 50 stations, including WABC in New York City and KRLA in Los Angeles. He is a practicing lawyer specializing in estate planning and is admitted to practice before the United States Supreme Court. He's a public speaker and commentator who has appeared on many radio and television shows throughout the country, and he's the legal editor of Talkers magazine, the preeminent trade publication of talk radio. His latest book is The Truth About Avoiding Scams.

The first thing you need to do is make sure that you have the authority to act on behalf of your father. If your father executed a Durable Power of Attorney appointing you to be able to act on his behalf, you will be able to act on his behalf with the IRS. If he has no Durable Power of Attorney and your father's cognitive impairment is not too serious, he may be able to have one prepared for him to sign now. If his cognitive impairment is too much for him to execute a Durable Power of Attorney, you should apply to a court to be appointed his guardian or conservator to be authorized to act on his behalf. The next step is to confirm that the amount that he is alleged to owe is correct. You should consult an accountant both to help ascertain the correct amount owed and to negotiate on your behalf with the IRS for a reduced amount settlement or payments over time.