Unfiled Tax Returns:The Facts

The reason some people fail to file their tax returns is that they don’t have enough funds to settle their taxes. Interest and penalties accrue on your tax liability, so it is increasing quickly. How should you solve this IRS problem?

Failing to file a tax return could cost you $25,000 each year and a year in prison for every year that you didn’t file if you fail to file a tax return. Not settling your taxes but filing your tax returns has no criminal penalty.

To know if taxpayers have filed tax returns, the IRS uses its computerized IRP (Information Returns Program) to match up 1099 income reports and W-2’s. This is a very effective system. Before the IRS finds out that you haven’t filed your tax return, get organized and get it done!

Filing Your Return

• All documentation should be gathered together and missing copies asked for from the IRS.
• You can get a tax professional to prepare your tax return. They will even deal with the IRS in your stead.
• Know all about tax refunds. Indeed, you might actually receive a tax refund from an unfiled tax return. Be ready to have the IRS utilize the refund for payment of your tax liability and be aware of the time limits.
• Settle your tax liabilities fully. A good plan can help you pay off your tax liabilities. You will also wish to protect yourself from an IRS probe by getting advice from a tax professional and cooperating politely with the IRS to get your taxes settled. This may need qualification for an installment agreement or Offer in Compromise. An established plan will let you get out of your IRS issues.
• Look to the future. If you wish to achieve your economic goals and decrease your taxes, research strategies and review your tax position with a tax professional.