In case it’s been a long time since you last filed your taxes, you could be highly worried about the outcome. You may be scared that something extremely awful will occur if you now attempt to have it resolved. There are a number of persistent non-filers who carry on avoiding filing returns since they are afraid of what the outcome will be if they do so. But, evading will simply make matters worse for you since the longer the time you avoid paying taxes, the more severe the consequences for you. Hence, how do you get yourself out of this jam and make an encouraging start by filing your returns after you have omitted to file for two years or more?
The following are a few guidelines and tips to help you start off in the correct path to filing your returns.
- Get in touch with the IRS – Although you may be scared, your foremost step is to take the bull by the horns and get in touch with the IRS to inform them that you’re striving to rectify the problem. Numerous people postpone contacting them believing that they won’t cotton on to the truth that you have to pay them money. You can be very sure that they already are aware and if they wished to, they already would have contacted you. Therefore, simply speak to them to get to the bottom of your problem.
- Learn how much is due – Once you call the IRS and pinpoint what are the years you haven’t filed taxes, you would have to determine the amount due. In order to perform this, you’ll need to recreate the income for all the years you’ve not filed. If you’ve not changed jobs frequently, this will not be difficult, but in case you had a number of employers, this may be far from easy. On most occasions the IRS can assist you with this since they already may have your payment details.
- Collate your income – Once the required information is available, collate your income and have everything organized for all the years you’ve not filed so you can draw level now.
- Compute any deductions – You will next have to consider any deductions that are owed to you during this time frame that you missed filing.
- Have them filed- Once all of the paperwork is in order, you can file the returns or visit a tax preparer or an accountant to file on your behalf. Once the last touches are put on the file, you’ll learn how much is due in taxes for the missing years.
- Pay the taxes due – Preferably, you would wish to send the amount due along with the tax return, but in case you don’t have the entire sum, at least forward what you can and then arrange to have the rest paid as soon as possible.
Once the IRS is in receipt of your filed returns, they will mail you a letter stating how much is owed in penalties for late filing of taxes. Then you can pay these penalties and fees or discuss with the IRS regarding a payment scheme or any other way of setting right the costs of your IRS debt.
It may be surprising for quite a few people to learn that the IRS wishes you to fix this problem. The IRS wants to help you out and unless you’ve deliberately set out to defraud them, they normally seek not to take severe measures. You can sort out this problem for all time if you have a little knowledge of tax law, and put in a little effort and dedication.
