Unfiled Tax Returns? Here is What to Do

April 15, or Tax Day, is a big day for tax filers and tax professionals. For a lot of people though, April 15th is a day of stress and worry.

Maybe you've got tax returns that you know are going to end up with you owing a lot of money. Maybe you don't have that money to pay, so maybe your solution in your mind is to just ignore it. Lots of people have that same solution. There are millions of people all over the country that have unfiled tax returns. Some individuals have unfiled tax returns for 5 to 10 years, some even close to 20!

Many of these people have the mindset that if I don't file the returns, maybe the IRS won't notice. It's been five years. They haven't noticed yet. Maybe they'll just never notice. That could not be more incorrect. The IRS will notice. They will find out. They will catch up to you and once they do catch up to you, it will be a mess.

When the IRS does finally get around to your unfiled returns, you will have a mess to sort through. You'll have penalties, you'll have interest, and it will all add up to a massive tax bill. The IRS will file your returns for you, and what they come up with will usually not result in a refund, and will likely result in you owing taxes tacked on with continuing interest and failure to file penalties. This will only get worse if you continue to ignore it.

So, What's the solution? What do you do? Number one, file those returns. Find your local CPA tax professional. Get him to look at your documents get those returns filed.

Just because you file a return doesn't mean that you have to submit a payment with that return. So if that's your hesitation, if you're not filing returns because you say, "Hey I'm, I know I'm gonna owe a lot of money for this tax year. So I don't have it, so I'm just not going to file it and I'm just going to ignore it." That is the worst possible solution.

You need to file the returns. You don't have to pay immediately. You just need to get your overdue returns filed. Once you get them filed, then you can tackle the issue of what to do with the amounts that are due to the IRS.

So what's the next step once you file those returns? Several different options. You could apply for a payment plan, you could apply for an offer and compromise where you maybe settle with the IRS for a lower amount just based on what you owe. You could possibly qualify for first time penalty abatement where they, waive the penalties for not filing.

The IRS will work with you. They're not just going to give you this massive tax bill and give you no options to deal with it. There are several options out there. We will cover these options in greater detail in future blog posts.

If you have years of unfiled returns and want to discuss these with a tax professional, be sure and visit our firm website at jeffordsanthony.com and submit an inquiry on our Contact Us page. You can also visit our YouTube channel where we discuss this and other tax issues at https://www.youtube.com/channel/UCRfN8oSuefXXI1WPHDpnzaw.