| Are you a taxpayer who has unfiled tax returns? This | | | | each year that you failed to file. Along with this, you |
| is not something that you want to forget about for any | | | | can also be sentenced to time in prison. |
| longer. If you have yet to file a past return you need to | | | | 2.Penalties - Your tax debt will grow (if you owe |
| take care of it now, not later. As you wait longer and | | | | taxes) and you will end up owing more than your |
| longer the consequences get worse. Is that really what | | | | original amount because of the failure to file penalty. |
| you want? Although you may feel that unfiled tax | | | | The failure to file penalty can accrue on your unpaid |
| returns are a huge burden, you can fix this problem in | | | | amount at 5% per month (up to 25% after 5 months). |
| no time at all if you know the process, policy, and | | | | 3.The IRS Will File a Return for You - This sounds |
| steps to take. | | | | great but it is not. If the IRS files a return for you (called |
| How Does the Process Work? | | | | a Substitute Return) you could miss out on certain |
| If you do not file your taxes for one year or more you | | | | credits and important important deductions. Again, this |
| are going to be pegged a non-filer by the IRS. This is a | | | | will only result in you owing more to the IRS. |
| status that you do not want. The IRS has a system in | | | | 4.You Will Be Unable to Qualify for Bankruptcy - |
| place to determine who has not filed all the proper | | | | Whether Chapter 7 or Chapter 13, if you do not file a |
| returns. They do this by matching W-2's and 1099's via | | | | tax return you cannot qualify to have your taxes |
| the Information Returns Program computer system. So | | | | discharged through bankruptcy. |
| while you may not hear from the IRS right away, at | | | | Steps or Guidelines to Follow |
| some point they are going to realize that you have not | | | | If you find yourself unable to file by April 15th, then you |
| filed and you will soon begin receiving notices. That is | | | | can request an extension using IRS form 4868 which |
| when your real problems will begin. | | | | will give you until October 15th to file (not make a |
| What Are Some of the Consequences of Failing to | | | | payment). This will also help you avoid the failure to file |
| File? | | | | penalty (unless you do not file on Oct 15th). If you tax |
| 1.Criminal Charges and Fines - Criminal charges (rare) | | | | return is much older, you should immediately begin the |
| can be brought against you if you have unfiled tax | | | | process of collecting old tax documents (W-2s, 1099s |
| returns and owe money to the IRS. This is not | | | | etc) so you can file as quickly as possible. |
| something to take lightly. It is a serious issue and the | | | | If you have not filed old taxes and you are unsure of |
| IRS will enforce the laws if you do not comply at once. | | | | your circumstances and how to move forward, |
| A fine can be assessed of up to $25k per year for | | | | contact a qualified tax professional. |