If your income exceeds your allowable exemptions and deductions, you should generally file a return. If you are due a refund, you must file a return within 3 years of due date or IRS can keep your refund.
What are consequences of not filing a tax return?
If you don’t file a required return, the statute of limitations for collections never technically expires. The IRS can also file a return for you and send you a bill. They don’t give you the benefit of any deductions you might be able to deduct on your own return.
What if I’ve lost my documents for the year I need to file?
We can request your tax transcript which lists everything that has been reported about you by various entities. It includes income and deductions.
Will the IRS contact me if I do not file? How?
The IRS does employ a program that can find taxpayers who have not filed returns. However, we talk to many people who have never heard from the IRS about their unfiled returns. Often, the motivation to file is to have peace of mind to prevent a future call from the IRS.
If I don’t owe the IRS, do I need to file a return?
No. However, it is usually a good idea to fill out a return to determine if you owe or not. Our tax laws can be very confusing.
How should I send late tax returns to the IRS?
They should be sent certified return receipt via the carrier.
Can I E-file a late tax return?
Only for the current year and the preceding 2 years.
Is it ever too late to file? Can I still receive a refund for a late return?
To receive a refund, a return must be filed within 3 years of the original due date of the return.
Is there interest on unpaid taxes?
Interest and often penalties. Both amounts can be substantial.
Can I settle my unpaid taxes for less than I owe?
If you meet certain criteria, you can. The offer in compromise program is available but you must file certain forms and meet very strict standards.
How do I find how much I owe the IRS?
Your tax transcript will show the taxes, penalties and interest owed.
Will my unpaid taxes show up on my credit report?
Tax liens filed by the IRS and state liens will sometimes show up on the credit report. The liens will possibly be recorded in the courthouse in the county where you live.
What happens if I haven’t paid the IRS for 2 consecutive years? 5? 10?
If you have filed and not paid, we need to contact the IRS to arrange a repayment plan or some other arrangement. Never ignore notices! A careful analysis of your tax transcript might reveal other options.