Indiana Tax Law Firm Provides Options to Those With Unfiled Tax Returns

Indiana Tax Attorney Offers Guidance To Taxpayers Behind in Filing Their Returns

When people fail to file their taxes, it is usually because they owe additional taxes that they are unable to pay. But when they skip one year, it usually turns into several. But getting back in to compliance might be a challenge, but not as difficult as you think.

Ramifications of Unfiled Tax Returns

It is generally best to file your back returns as soon as possible, and the longer you wait, the more serious the consequences may be:

• If you need to file a return for a prior year or multiple years, you will want to ensure that the return is as accurate as possible, as penalties and interest accrue from the base tax owed.
• If you fail to act before the IRS does, they will file a substitute for return (SFR) on your behalf, and tack on a variety of penalties and interest without giving you any deductions, credits, or allowable expenses.

What If I Owe?

If a tax liability will likely result as a result of filing outstanding returns, if you are not able to pay the full liability, the IRS may allow you to enter into an installment payment agreement with them. Generally, the IRS has 10 years to collect an outstanding debt from the date the tax was assessed. However, in some circumstances, the IRS will allow taxpayers to negotiate their back taxes if the taxpayer can establish that he does not have sufficient income and assets to pay what is owed within a reasonable period of time.

How About If I'm Due a Refund?

If you have unfiled returns and believe that you are entitled to refunds due to federal tax withholding or estimated tax payments, there is a limited period of time that you can obtain a refund of money that you overpaid. All federal tax withholding that occurred throughout a calendar year is considered paid to the IRS on April 15 of the following year. A taxpayer has three years from the due date of the return or two years from the date a tax is paid, whichever is later, to make a claim for a refund. Failure to make a claim within that time period will result in claim denial and loss of the refund.

If you haven't filed your federal income taxes for several years, you may wonder if you have any options. The law firm of Saeed & Little LLP is experienced in tax issues and ready to help. Contact us online or call 317-800-6181 to speak to a tax attorney today.