It is easy to get behind in taxes and allow one unfiled tax return to turn into two, three, or many more. It is also tempting to ignore this problem and assume it will not be noticed or that it will go away. This is not the case. The IRS closely monitors annual income taxes and monitors businesses taxes even more closely. It is highly unlikely that unpaid tax returns will go unnoticed. If you have unfiled tax returns, the best course of action is to file them. If you are concerned about penalties and debts you may owe due to unfiled or late tax returns, there are options available. If you resolve this problem as soon as you can and work with a tax professional, you can resolve your tax debt and stop unfiled returns from hanging over your head.
Tax Debt and Filing Back Taxes
If tax debts and penalties have been levied against you from one unfiled return and you have several, other penalties will follow. Though filing back taxes may incur more debt from the start, fewer relief solutions are available to you if you do not file back taxes. With a tax professional to help you file, you can organize your financial documents from previous years, make accurate calculations, and get current on all your tax debt and returns. With a clean slate, you will be able to move forward with confidence.
Documents You May Need
Filing back taxes can seem like an insurmountable task at first, but we have an organized process to make filing back taxes simple and straightforward. To file back taxes, we will need an accurate picture of your income and expenses for the year that was not filed. This can be completed through pay stubs, electronic records of payments filed, or bank records showing deposits and withdrawals. Other documents such as records of property tax payments, rent or mortgage payments, payments to IRAs or HSAs, records of interest and dividends you received, alimony or child support paid, and other income or expenses may be required. Through your bank statements and other accounts, we can find this information even if you no longer have direct paper documents or receipts.
For individuals or families:
- Identification and filing status
- Identification of all dependents
- Income or bank statements
- Interest and/or dividends
- Rent or mortgage payments
- Amounts paid to IRAs or HSAs
- Alimony or child support receipts or payments
- W-2s or 1099s
Additional documents are required if you own a business or if you are filing back taxes or refiling inaccurate taxes from a previous business. To give you an accurate return and to lower your tax liability as much as possible, we will need information on your business expenses, accounts receivable, inventory, sales, investments, purchases, and other expenses and income.
This list is not exhaustive. Other documents may be required to file your returns and to negotiate with the IRS on your tax debt and payment timeline. If you have suffered a financial or personal hardship such as a death in the family, severe illness or injury, natural disaster, you think your former spouse filed taxes incorrectly, or another situation that significantly interfered with your filing, documentation of those events will also be helpful.