There are many reasons why people don’t file their taxes, and while most of them are valid, the fact of the matter is that even late or back taxes eventually need to be filed. Filing back taxes will actually lessen or altogether avoid future problems with the IRS. Whether you have only missed filing for a single year or you have not done so since the mid 1980’s, the IRS still requires that you file your taxes. This will certainly lessen your risk of being prosecuted by the IRS and having enforced tax collection methods thrust upon you.
It is best to have all tax records compiled but this may not be the case for some people. Phenomena like fires, floods and other disasters may destroy all of a person’s belongings, including relevant documents. Nevertheless, one of the key measures to filing back taxes is finding a great tax attorney and accountant who will be able to aid in the reconstruction or retracing of a client’s tax records. At best, they can prepare and recreate relatively precise and complete tax records dating back to 15 to 20 years ago.
In certain circumstances, people simply do not have enough funds to pay the amount due on their returns. But options for filing a missing tax return or back taxes are always available. Among the major benefits of this move is avoiding a substantial penalty of 25%, which is the charge for late tax returns. In some states, failing to file your income tax return can result to a large penalty even if you do not owe the government any money.
You will definitely conserve a great deal of time if you were able to gather all your tax information from previous years. What you just have to do now is prepare your tax returns. It is at this point that many people will see the need for professional assistance in order to avoid further IRS problems. Not knowing whether or not you owe back taxes, or knowing that you haven’t paid these can be a burden. This is why some clients feel that merely setting up a meeting with a tax professional to help them through the maze of forms and procedures is utterly comforting already.
People must, on the other hand, understand that they cannot file back taxes through e-file or other electronic filing systems. These must be submitted through hand delivery or mail. When they are mailed, they must be sent using certified mail in order to have proof that the IRS received your tax returns.
Those who are aware that they owe the IRS any amount of money will be required to pay the applicable interest and fees. If you happen to be one of these people, you can always request help from the IRS for the setting up of payment plans.
Filing for back taxes can actually be a relatively quick and easy procedure. What would make matters difficult is if you will refuse to immediately deal with the issue and file or pay back taxes. At worst, these IRS issues may cause you to owe substantial amounts of money and face more serious consequences.
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