Take Action When You Have Not Filed Tax Returns In Years

Law Blog

Taxpayers are expected to file a return each year, but for one reason or another, some people fall behind a year or sometimes even more. This scenario is not ideal, but it is one that is workable. If you have fallen behind on filing your taxes, learn what you can do.

Collect Documents

Begin your efforts by collecting all your financial documents, including income statements and documentation for any credits you plan to claim. This task is often time-consuming when filing for a single year, but if you need to file for multiple years, it can take even more time. It is essential that the information is accurate. 

While you may have not filed, the entities that supplied this documentation, such as an employer, have already sent these records over to the IRS, so the information must match. 

Determine Account Status

Regardless of the reason you did not file, you want to determine what your account status is. For example, will you be due a refund or will you have a tax liability?

If you have not filed and you have calculated that the IRS owes you a refund, you can go ahead and file each year that you missed separately and wait for your refund to be returned to you. However, if you have a tax liability, there is some prep work that should go into the process before you submit your returns to the IRS. 

Make a Plan for Liabilities

If you owe money to the IRS, make a note of why you have not filed. If you have a valid reason for not filing, you may qualify for penalty relief for a responsible cause. Penalty relief is often awarded in instances such as illness or natural disasters. In this case, the filing and payment arrangement processes are often straightforward.

However, if you do not have a situation that qualifies for penalty relief, you should sit down with an attorney to discuss a plan for repayment. You have a greater chance of coming to an agreement with the IRS if you also submit a plan for repayment at the time of filing. An attorney can help you formulate a suitable plan based on the balance and your financial means. 

Remember that each person's tax situation is different, so what works for one person may not be the best course of action for the next. However, no matter the circumstances, a tax attorney can help you navigate this complex situation to get everything up to date.

Reach out to a service such as IRS Trouble Solvers, LLC to find out more.


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