A Taxpayer’s Guide to Late Tax Filing

Penalty for Late Filing Income Tax Returns

Filing your taxes on time is always important to avoid getting into any kind of trouble with the IRS. While this is the most ideal scenario, there are times when taxpayers find themselves filing late, sometimes even for several tax years. If you find yourselves in a situation whereby you are filing late or haven’t filed in a few years, it is important to know how to proceed. Working with a proven Dallas IRS attorney is the best way to get everything right as there are quite a few debt relief avenues such as IRS offers in compromise, IRS penalty abatement, and IRS tax installment agreement.

What are Late Taxes?

In the absence of an extension, all taxes that are filed past the deadline are considered as ‘late taxes.’ The IRS handles late filing cases differently depending on the length of time the taxpayer has gone without filing, the amount of taxes they owe, and the ability to pay the outstanding amount. What remains clear is what happens if you don’t take action to file your taxes, as you will most likely become the subject of a penalty for filing taxes late; fees, interest, and liens. While the IRS may sometimes take a while to pursue unfiled and unpaid taxes, the truth is that the problem will never go away on its own. What you need to remember is that it’s never too late to file.

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What Happens if You Don’t File?

If you fail to file your taxes, the IRS may file on your behalf. This usually happens if you fail to respond to notices. The IRS employs a sophisticated system to verify how much each taxpayer owes. The system takes into account information such such as payroll and tax records. This is how the agency is able to know your earnings even if you don’t file. The biggest downside of letting the IRS file on your behalf is that you will forego most credits and rebates to which you may be entitled. This means that you will end up owing more and also be the subject of failure-to-file penalties. While you are still entitled to refunds even when you file late, the facility goes away if you delay for more than three years.

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How to File Late Taxes

When filing late taxes, you need to be in possession of W-2 or 1099 forms for the outstanding years to be able to accurately report your income. You will also need Form 4506-T: Request for Transcript of Tax Return from the IRS, if you are missing some documents. To get the best IRS debt help, it is imperative to consult an experienced Dallas tax attorney such as Nick Nemeth. In the event that you can’t pay the outstanding amount in full, tax attorneys in Dallas, Texas are best placed to assess your eligibility for different tax debt relief avenues including IRS offers in compromise, IRS penalty abatement, and IRS tax installment agreement.

Last Word

As said before, unfiled and unpaid taxes don’t go away even if you don’t receive IRS notices for a long time. The best way to handle unfiled and unpaid IRS taxes is to take action now, even if you are having financial difficulties. Avenues such as the IRS offers in compromise help lighten the burden of unpaid taxes. The Law Offices of Nick Nemeth has been helping the Dallas community get the best IRS problem solutions for many years. We have a team of highly experienced debt attorneys that are always ready to discuss your case and render the necessary assistance. To get a FREE no-obligation consultation, call (972) 627-4705 or fill out our contact form.

A Taxpayer’s Guide to Late Tax Filing
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