Tax Lien on a Minor

[morty_jones]

This is in NY. I had a tax lien placed on me in 2004 and the IRS backup withheld my accounts for not paying taxes. Money was removed in 2005-09 (from my trust account) as well for failing to pay taxes/owed debts. The state may have also seized money and I'm not positive of the amount but I believe it was ~30-50K.

However I was a minor up until the end of 2009 and while I understand that the accounts were in my name, they were also under my guardians name and I don't understand how I could be held accountable for filing those taxes. I also believe that someone else may have been given power of attorney over my finances after the first incident with the IRS in 2004 however I do not know where to locate that information. My guardian passed away shortly after turning 18 and I had no knowledge of most of this until I received a letter in 2010 regarding more debt. I appointed a relative as power of attorney (to the IRS) to look into matters. Said relative filed the back tax returns, and I was assured that the returns went towards paying the back debt.

I can accept the fact that I might not get the money that was taken originally back, but I was recently informed that despite my balances being cleared, paid tax liens remain on your record for up to an additional 7 years, marring your credit. This coupled with my money being seized as a minor has made it very difficult for me as a 20 year old with no parents to put myself through university and maintain a normal life. I'm inquiring to find out if there is anything I can do to clear my name.

[jk]

I'm inquiring to find out if there is anything I can do to clear my name.

paying taxes owed would be a good start if there are any. Other than that, the reporting on your credit history is proper as long as it is accurate.


I'm missing something here. For some reason you believe you should not be held accountable for taxes on money earned by you or from some income producing account. Of course you are responsible for those taxes. If your guardian misused your money or failed in their duties to act in your best interest (such as filing timely tax filings), you may have an action against him/her but since they are deceased, that would be difficult to maintain.

[Bubba Jimmy]

If anything prior to age 18 shows up on your credit report you should be able to get that removed.

[morty_jones]

paying taxes owed would be a good start if there are any. Other than that, the reporting on your credit history is proper as long as it is accurate.


I'm missing something here. For some reason you believe you should not be held accountable for taxes on money earned by you or from some income producing account. Of course you are responsible for those taxes. If your guardian misused your money or failed in their duties to act in your best interest (such as filing timely tax filings), you may have an action against him/her but since they are deceased, that would be difficult to maintain.

I apologize for bringing this matter up nearly a month later

http://www.irs.gov/publications/p929...link1000203764

"Generally, the child is responsible for filing his or her own tax return and for paying any tax, penalties, or interest on that return. If a child cannot file his or her own return for any reason, such as age, the child's parent or guardian is responsible for filing a return on his or her behalf."

Is there anywhere that explicitly states what age is appropriate for a child to file their own taxes?

@bubba: I wrote a letter to have it removed from my credit report so thank you for that advice.

I'm really concerned about this matter because in adding up my annual incomes I realized that prior to age 18 I made ~500-600k and it vanished without a trace. Money doesn't just disappear like and no one has been willing to help me figure out it out. I don't know the total amount that was taken from federal liens and levies (NYS assessed ~6,000 dollars in penalties) yet even with backup withholding being up to 28%, it could not have totaled anywhere near that amount. The bank statements of the accounts with my names on them don't show any more than 30k at a time and after the lien and withholding began the amounts drop to the hundreds/1-3k. I've been told by close friends of my mother and by a family member that her mother was given control of my finances yet I can't find any documentation.

[Bubba Jimmy]

I would consider hiring an attorney to represent you for that kind of money. S/he can investigate what happened to that kind of money.

[jk]

If anything prior to age 18 shows up on your credit report you should be able to get that removed.

why is that? Experian states they do not publicize a minor's credit history and will not provide it to anybody other than a parent or guardian of the minor.

That contradicts the state of California's statement here:http://www.privacy.ca.gov/consumers/security_child.pdf

The credit reporting agencies do not knowingly maintain credit files on minor children. You
can find out if your child may be a victim of identity theft by contacting the three major
credit bureaus. You may do this by calling them at the toll-free numbers below.

I do notice that California said nothing about maintaining such a report is contrary to law. That and the fact that Experian specifically states that they do maintain such records, I do not see any justification for having a minor's credit history removed. Basically, if the child has a credit history, I see nothing improper about it being reported to the CRA's.

[Bubba Jimmy]

It is because a minor is legally incompetent to contract for credit.

[jk]

It is because a minor is legally incompetent to contract for credit.

Contracts with a minor are often voidable but the are not invalid in themselves. In fact, concerning life necessities, they are often able to be held liable for a contract.

Besides that, what does the legal capacity to enter into a credit contract have to do with the CRA's maintaining a credit history? I know of nothing that prevents a minor from entering into a credit contract but the CRA's report on more than just credit accounts.