Taxpayers that fail to file their tax return for one or more years for various reasons can become overwhelmed later on down the road when attempting to file all their missing tax years at once. Missing all or a portion of their records, personal hardship and/or neglect are some of many reasons people fall behind in filing their taxes. Fortunately, there are ways to approach the problem of unfiled tax returns.

What happens if you have Unfiled Tax Returns?

Most years,  the IRS requires you to file your taxes by April 15th. If you don’t file your tax return you may receive late penalties, and your refund could be delayed or even forfeited if filed late enough.

Late penalties

The IRS will assess a penalty equaling 5% of any unpaid taxes for every month that a tax return goes unpaid. This will max out at 25%. Speak to a professional consultant if you need to file for an extension on your taxes to avoid these penalties.

Delayed Refunds

If you consistently file late, the government may run an investigation, which can take some time. This will consequently delay your tax refund and may result in a refund being forfeited depending on the fines.

How many years does the IRS go back for Unfiled Tax Returns?

The IRS rarely goes past six years for non-filing enforcement. For the most part, delinquent returns and SFR enforcement actions are completed within three years after the due date of the return.

How do I resolve Unfiled Tax Returns?

To resolve unfiled tax return problems, consider the following steps.

  1. Gather all the information needed to file the past-due return. You can do this by contacting the IRS and requesting your wage and income scripts.
  2. Complete your return accurately and submit it to the appropriate IRS unit.
  3. Keep an eye on the return processing and other compliance activities. You can do this by contacting the appropriate IRS unit to make sure the IRS processed your return.

The IRS maintains a file going back numerous years of all W2s, 1099s and 1098s (mortgage interest paid) filed in the name of individual taxpayers. Optima Tax Relief can determine certain facts from master file transcripts, available for those years where the IRS has prepared a substitute return. These ‘records of account’ provide adjusted gross income, taxable income, tax, number of exemptions, filing status and self employment tax. When we take on this kind of case, we will assist in re-filing your returns and our negotiations will be based on more favorable returns for your benefit.

Optima Tax Relief can help with Unfiled Tax Returns

Optima Tax Relief can prepare past returns using various substitute sources when there are missing records. Those returns should be filed as soon as possible in order to avoid accumulated compounding interest. Also, it should be noted that if returns have not been filed for the three most recent tax years, those returns should be prepared immediately in order to claim any refunds that may be due. For assistance with a tax return, speak with a licensed professional at Optima Tax Relief.

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