Whether you owe federal taxes or not, the IRS requires that every American taxpayer file a federal income tax return every year. If you have missed one or more years of tax returns, then you can file those returns late and avoid the wrath of the IRS. You will incur penalties for not filing your taxes on time, but it is better to pay the fines than have the IRS impose the many penalties that are associated with not filing a tax return.
Some Basic Facts About Filing Late Returns
In general, the IRS can help you retrieve old tax information from the previous 10 years. If you have missed filing returns from more than 10 years ago, then you are going to have to work with the IRS to catch up with your filings. Whether you owe taxes or have earned refunds, you will have to pay fines and penalties when you file. The IRS will usually deduct the fines and penalties from any refund, but you will have to pay them out of pocket if you owe taxes.
Collect All Of Your Information
You will need all of your receipts, W-2s, and or 1099s from each of the years you did not file. As you collect this information, you should keep it separated by year because you will need to file each year separately.
Collect The Proper Filing Forms
If you missed filing your taxes in 2016 and are going to make up for it in 2018, you cannot use the 2018 forms. You must go online and download the 2016 forms to file correctly. If you try to use the current forms and instructions to file older returns, the IRS will return them to you to have them re-done. The IRS can help you get the forms and instructions for filing as far back as 10 years from the current date. If you cannot find the correct year information online, then call the IRS.
Pay As Much As You Can
The amount of penalties the IRS will impose on missed tax payments has a cap on it, but the interest does not. When you do your past due taxes, the amount you calculate is only part of what you will owe. The IRS will send you a bill that adds on the penalties and interest for each year that your return was not filed. It is always best to pay as much as you can when you file your return to reduce how much the IRS will bill you for later.
Generally, Americans must file their income tax statements from the previous year on or around April 15th of the following year. If you do not file your return, the penalties and interest start accruing immediately. At some point, the IRS will realize that you did not file your taxes and start demanding that you file. If you know that you have missed a year or more in filing your federal taxes, then it is best to file them as soon as possible.
Jim Treebold is a North Carolina based writer. He lives by the mantra of “Learn 1 new thing each day”! Jim loves to write, read, pedal around on his electric bike and dream of big things. Drop him a line if you like his writing, he loves hearing from his readers!