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filing back taxes

What happens if you don’t file taxes?

Tax day can be stressful for many people but even more to a person who hasn’t filed their taxes in a few years. The longer you go without filing your taxes, the more stressful your situation will become, so you may as well try to fix it. Especially when you start thinking about the penalty charges that may be accumulating.


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What happens if you don’t file your taxes?

Not filing your tax return can be considered a criminal violation. You could end up with a levy put against you or it could be prison time. A levy permits the takeover of your property to satisfy a tax debt. That could be garnishing your wages, taking money from your bank account, seizing and selling your vehicle, real estate property or other personal property. The good thing is that the IRS actually does try to help those who come forward on their own and in many cases are willing to work something out.

How do I file late tax returns?

  • Gather your tax documents and file your tax returns. For each of the years you have not filed your taxes, you are going to need your W-2’s and/or 1099’s. If you are unable to locate these documents, you can request them from the IRS using a Form 4506-T. You will need to file a return for each year you missed. Most companies that provide e-filing services have forms for the past two years. If you need to go back further than that, you will have to request the forms from the IRS and submit your returns by mail.
  • Pay taxes that you owe. Once you have submitted your tax returns to the IRS and your state, you will want to pay any taxes that you owe along with penalties that have accumulated. You can check out the list of penalties on the IRS website. If you cannot pay your entire balance, you will be charged interest until you can.
    • If you are expecting a refund or ended up not owing any taxes, there is no penalty.
  • Work out a payment plan with the IRS. If you are unable to make a payment in full for what is owed, you could be eligible for a payment plan. If you are currently low-income, they may have additional options for you. You can apply for a payment plan on their website or by calling the IRS at (800) 829-1040.

Get in touch with a tax professional

In most cases, simply filing your tax returns and paying your taxes will get you out of tax trouble. However, it might be a good idea to meet with a tax attorney to make sure you are handling things correctly and to learn about any other options that might be available to you. Rocket Lawyer can help by connecting you with a tax attorney or you can ask a lawyer a question online.

While it may be stressful, in the long run, it is best if you address your IRS issues now. File your tax returns and pay your back taxes to get in good standing with the IRS and your state tax agency. Perhaps next year, you’ll even get a refund.

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