Generally speaking taxpayers know the importance of filing their tax returns on time.  However, sometimes people do not file their returns on time or at all.  There are three common reasons for unfiled tax returns.

1.    The taxpayer is concerned that filing now will cause an audit
2.    The taxpayer cannot find the records or forms needed to file the earlier return
3.    The taxpayer cannot afford to pay the taxes due on the returns they have not filed

Although these are the most common reasons, every situation is unique. If your unfiled tax returns would have given you a refund, you waive that refund after three years.  In other words you only have three years to file the return and if it remains unfiled for the entire three year span, you are no longer entitled to the refund.  However, you will still be responsible for paying penalties and interest assessed for failing to file and/or late filing.

For every day that you have neglected to file your return the IRS adds interest and penalties to your original tax debt.  On average, your tax debt will double every five years as a result of penalties and interest.

If you do not file a return the IRS basically files it for you using a SFR (Substitute for Return).  This SRF assesses a tax debt due based on income they have on file for you.  The IRS does not give you ANY deductions when they use the SRF and will send you a bill for the total they deem owed.  Of course they will also continue to add penalties and interest because you did not file the return yourself and if you do not pay the amount owed, they will add additional penalties and interest for late payment.

If you have unfiled tax returns you need to contact a tax professional that is well versed in filing previous year’s returns.  This professional should be able to access your back tax records and find out what the IRS filed for you (any SRFs) so that they can determine if there will be any problems bringing you current.  This is not something you would easily be able to do on your own!    However, do your choosing carefully as regardless of whom you choose to assist you with your unfiled tax returns, you remain the responsible party.  Therefore if the tax professional you choose makes an error or in any way is incorrect, it is YOU that will be held accountable by the IRS, not the tax professional.

If you have unfiled tax returns you need to address them quickly and immediately!  The IRS can levy your wages; put liens on your property, home, savings, checking account and any other asset you have in order to collect on back taxes.  The IRS takes this very seriously and uses very aggressive collection activities to recoup the money owed.

Do your research and find a qualified tax professional to assist you today!  Don’t wait another moment, as each day is costing you more and more money!