Unfiled tax return preparation is often a central component of income tax controversies and resolution. Many of our clients seek assistance with filing delinquent or missing tax returns after not filing tax returns for one or more previous tax years. In most cases this transgression does not catch up with the taxpayer immediately. Eventually, however, the IRS or state taxing agency will recognize that your tax returns have not been filed and begin the enforcement and collection process. Potential consequences of unfiled tax returns include:
- Late penalties – The IRS will likely assess a fee (based on a percentage of your total tax burden) for every month you are late on taxes – up to 25%.
- Liens and levies – Continued failure to file past tax returns will eventually result in the IRS putting liens and levies against your assets, including garnishing your wages or seizing your property.
- Criminal enforcement – you can be arrested and charged for failing to file your taxes (i.e. intentional tax evasion).
Our firm offers tax return preparation to individuals, families, entrepreneurs and small businesses to prevent the types of consequences above.
- Contact the IRS or other tax agency and negotiate a collection hold to prevent further collection activities, bank levies and/or wage garnishments.
- Work with you to gather income, expense, tax credit, and tax payment information for the tax year(s) at issue. Some information can be acquired directly from the IRS or state on your behalf.
- Prepare and file the missing tax return(s).
- Provide options available to resolve your remaining tax liabilities through appropriate tax controversy resolution services.
A. Failure to file a past due return can have serious repercussions. If a tax return is not received, the IRS can file a substitute return on your behalf using information collected from your employer, bank, and other sources. This return will lead to a tax bill. If this bill is never paid, the delinquent tax collection process will begin, allowing the IRS to levy your wages or bank account or even file a federal tax lien against you.
Q. What if I don’t have records needed for a delinquent tax return?
A. The IRS recognizes it is difficult to determine income tax liability from a number of years ago, e.g., records may be unavailable. Normally the IRS only requires you to file the last 6 years returns. If complete tax records are not available, a return based on the “best” information available can be filed, but this is a last resort and should be disclosed on the return. We recommend you Schedule a Consultation with us to determine how we might help. We do not recommend contacting the IRS on your own.
Q. What if I owe taxes?
A. Any taxes you owe are still due on the tax return based on the date they were originally due. The IRS will charge you interest and a penalty for paying late. These charges are based on the amount you owe and the length of time it takes to pay it. The sooner you pay the tax, the better it is for you. If you can’t pay all at once, you have options. As our client, we will help you determine the best course of action to take based on your individual circumstances.
Q. What is the cost of tax return preparation?
A. Our IRS tax resolution fees are based on our flex-fee structure, and all costs are pre-approved by you when you decide to hire us. We offer payment plans, if needed, and set our fees so you do not have to worry about unexpected legal bills. There are no surprises, no add-ons. Because every situation is different, we recommend you Schedule a Tax Consultation so we can discuss your case in detail.