Obviously, those potential clients that are “Constitutionally Challenged” (formerly known as Tax Protestors) will argue with you all day as to the compliance component of the resolution. I only take about 10% of these type clients and only after they have openly admitted they were duped by some fast talker scheme salesman. It is your practice and do as you may.
For 941’s, 940’s, 1120’s and 1065’s, the IRS usually demands that all missing taxes are filed. This brings up many issues which must be dealt with.
You will prepare all the old taxes. But before you file them, we need to take a brief step back and look at the big picture before moving on. Is it wise to file the returns as Married Filing Jointly if the taxes, penalty and interest cannot be paid in full? Are you not wiser to do your own “Innocent Spouse” by never filing a joint return in the first place? If, indeed, one of the taxpayers cannot pay, does it matter if they owe $80,000 MFJ versus $120,000 as MFS (and then the other spouse has little or no liability)?