There are several reasons why people do not file their taxes, and while most of them are acceptable, the fact of the matter is that even late or back taxes eventually need to be filed. Filing back taxes will in fact, alleviate or altogether avoid future problems with the IRS. Whether you have only missed filing for a single year or you have not done so since the mid 1980s, the IRS still requires that you file your taxes. In the end, it will be to your benefit, as doing so lowers the risk of being prosecuted by the IRS.

There might be occasions when all tax records are not available. This is especially true in cases of fire, flood and other natural calamities when all of a person's belongings are damaged. Good thing that tax attorneys or accountants are around to help clients reconstruct or retrace their tax records dating as far back as 15 to 20 years ago. These alternatives make the arena of back taxes clearer.

Some people would have preferred to dutifully pay for their taxes but certain circumstances, such as not having adequate funds to pay the amount due on their returns, prevent them from doing so. Luckily, they are provided with the choice of filing a missing return or back taxes. If you do this, you will not be penalized with the fee for late filing, which is a substantial 25%. Some states can in fact penalize you with larger fees even if you do not owe them any money, if you fail to complete this legal obligation.

You will definitely save a great deal of time if you are able to gather all your tax information from previous years. You can then proceed with the next step, which is to prepare your tax returns. This is the stage, though, when you need expert help the most. Not knowing whether or not you owe back taxes or knowing that you have not paid these can be a burden. This is why some clients feel that merely setting up a meeting with a tax professional to help them through the maze of forms and procedures is utterly comforting already.

Most people go on believing that electronic methods can be utilized in filing for back taxes. The IRS, however, does not accept these as they prefer to receive these requests through hand delivery or mail. To have proof that the IRS has received these tax returns, you must send them using certified mail.

Those who are aware that they owe the IRS any amount of money will be compelled to pay the applicable interest and fees. In such an instance, you can ask the IRS to help you set up a payment plan.

Depending on a person's specific situation and other aspects of his/her case, filing back taxes may be a relatively quick and easy process. However, putting off dealing with the situation and not filing or paying back taxes will only make matters worse. Increasing the amount of money due and worsening penalties are just a few of the consequences of such action.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

How to File Back Taxes and Avoid Future IRS Problems is a post from: IRS Tax Problem Solver Blog - IRS Help

Here's a great question from a reader. Unfiled tax returns can be a real problem. Many people don't realize it but the IRS can (and will) file Substitute for Returns (SFRs) for people who don't get around to filing their tax returns. This video covers what to do if you're a non-filer. Watch the video for the question and it's answer…

Unfiled Tax Returns for more than 10 years???? is a post from: IRS Tax Problem Solver Blog - IRS Help

Usually the IRS wants your money, however unclaimed refunds totaling approximately $1.2 billion are awaiting nearly 1.3 million people who failed to file a federal income tax return for the tax year 2004. However, to collect the money, a return for 2004 must be filed with an IRS office no later than October 15, 2008. Those due a refund who did not file a 2004 tax return could collect even more money by also filing a 2007 tax return to claim the economic stimulus payment. The IRS estimates that half of those who could claim refunds for tax year 2004 would receive more than $552. In some cases, individuals had taxes withheld from their wages, or made payments against their taxes out of self-employed earnings, but had too little income to require filing a tax return. Some taxpayers may also be eligible for the refundable Earned Income Tax Credit. In cases where a return was not filed, the law provides most taxpayers with a three-year window of opportunity for claiming a refund. If no return is filed to claim the refund within three years plus extensions, the money becomes property of the U.S. Treasury. For 2004 returns, the window closes on October 15, 2008.

The law requires that the return be properly addressed, postmarked and mailed by that date. There is no penalty assessed by the IRS for filing a late return qualifying for a refund. You can't get a refund unless you file a tax return. Don't risk losing your tax refund. The IRS reminds taxpayers seeking a 2004 refund that their checks will be held if they have not filed tax returns for 2005 or 2006. In addition, the refund will be applied to any amounts still owed to the IRS and may be used to satisfy unpaid child support or past due federal debts such as student loans. By failing to file a return, individuals stand to lose more than refunds of taxes withheld or paid during 2004. Many low-income workers may not have claimed the Earned Income Tax Credit. Although eligible taxpayers may get a refund when their EITC is more than what they owe in tax, those who file returns more than three years late would be able only to apply it toward the taxes they owe (if any). They would not be able to receive a refund if the credit exceeded their tax.

IRS Has $1.2 Billion for People Who Have Not Filed a 2004 Tax Return is a post from: IRS Tax Problem Solver Blog - IRS Help

So you didn't file your tax return this year. Maybe you forgot, maybe you didn't have the money to pay your balance due, or maybe you thought you could beat the system. The IRS doesn't really care, need, or want an explanation as to "why" you didn't file. If you don't file, you're setting yourself up for a bigger problem down the road. Here's what happens when you don't file: penalties, interest and possibly jail.

The Failure to File penalty is 5% of your unpaid balance per month, up to 25%. You're also more than likely going to be hit with the Failure to Pay penalty, which is 1% of your unpaid balance each month and there is no ceiling on this penalty. The more time passes, the higher it gets. Then there is the interest, which is compounded daily and compounds on the penalties too. So it really doesn't matter to the IRS if it takes them a couple of years to figure out you didn't file, because you'll get socked with penalties and interest and interest on the penalties for the entire time. It's very easy for a small tax liability from a couple years ago to triple in that time. What about jail? Absolutely. The IRS can prosecute you for criminal failure to file and send you to jail. The statute of limitations for criminal failure to file is six years, so at the very minimum make sure you have your last seven years of returns filed even if you can't pay any balance due. The IRS has a policy not to prosecute anyone that voluntarily gets into compliance before they begin an investigation.

File those past due returns even if you can't pay the balance in full. This will help keep you out of jail. If you want to save some money and can afford monthly payments you'll cut your failure to pay penalty in half if you enter into an installment agreement and make your payments on time. If your debt is growing out of control seek a competent representative to handle your case before the IRS. There are several resolution options to your tax problem that can help you sleep better at night, including setting up a payment plan you can afford – even if you've tried yourself and the IRS turned you down – a skilled professional can accomplish for you what you couldn't for yourself. A competent and skilled tax representative will charge a reasonable fee for their services, it's important to expect that. When you owe the IRS $25,000 and you pay a professional $3000, and in turn your tax debt is reduced to $9500, you just saved 50% including the fee for his or her services. Be an adult, take responsibility for your situation, don't expect to wipe out your tax debt for pennies on the dollar. Set yourself a reasonable expectation and recognize that yes some can settle their debt for less, but not everyone.

If you have a tax problem due to non-filing give us a call tollfree at (888) 438-6474. We're used to handling non-filer tax cases as most of our clients are, in fact, non-filers. We generally help them get caught up to date with their filing obligations, then formulate a plan using various IRS Problem solutions to help them get back into the system, without breaking the bank.

Are you an IRS (tax) non-filer? is a post from: IRS Tax Problem Solver Blog - IRS Help

Laws for Non-filers

Not filing your tax returns for a year or more, will undoubtedly alert the IRS and you will be classified as a non-filer.  If you have acquired this status, you have IRS Problems.   Whether you have not filed because you procrastinated, you did not have the money to pay the taxes you owed, or you just have chosen not to file, the IRS will catch up with you and you will pay the penalties.

IRS Procedure

The IRS uses a computerized Information Returns Program (IRP) to match W-2’s and 1099 reports to determine if taxpayers have submitted their returns.  If it finds no match, it knows the taxpayer has not filed a return.  Soon you will be receiving notices.  If you ignore these, you will either receive a phone call or letter, a call or visit from a revenue agent, or possibly a visit from a special agent.

Charges

Criminal charges can be brought against you if you owe taxes and do not file a tax return.  A fine can be assessed up to $25,000 per year and/or you can be sentenced to one year in prison for each year you failed to file.

Civil charges include penalties and interest that is assessed on the taxes you owe.

IRS Policy

The IRS usually does not pursue non-filers after 6 years of the filing date of the tax return.  This does not mean that if you did not file a return 10 years ago you are off the hook.  If you owed taxes, those taxes have been accruing both penalties and interest.  Your tax debt is increasing quickly.

Steps to Take

To avoid criminal charges and/or to add to the civil charges, it is important to file your tax return even if it is late and even if you cannot pay the taxes you owe.  Do this before the IRS becomes aware of your non-filing status.  If you do not have the necessary documentation or tax returns you need, contact the IRS for this information.  Remember, just filing your return will stop the penalties assessed for failure to file.  Your tax debt will continue to increase with the addition of interest that is accruing though.

If you have not filed your tax return for multiple years, consider mailing each year separately and on different dates.  The IRS will not be alerted of your non-filing status as easily if mailed this way.  It is also important to mail your returns via certified mail so you will receive notification of receipt.  Make sure you keep copies of all your correspondence with the IRS including the postage receipt.

For help with all your IRS Problems, contact our office.  With our assistance you can resolve your IRS Problems and make plans for your future.  Contact us today.

Are You a Taxpayer with Unfiled Tax Returns? is a post from: IRS Tax Problem Solver Blog - IRS Help

There are many reasons why people fail to file their tax returns.  One of the most common reasons is that they do not have the money to pay their taxes.  Whatever reason you have had, if you have not filed your taxes for a year or two, you now have IRS Problems.  One of the easiest ways to rid yourself of this specific IRS Problem is to file your back taxes.

With the use of their computerized Information Returns Program, the IRS matches W-2’s and 1099 income reports.  This shows them who has and who has not filed their tax returns.  Your best course of action is to get your tax returns filed before your IRS Problems get any bigger.

Worst Case Scenario

Did you know it is a crime to not file a tax return if you owe taxes?  The fine for not filing your taxes can be as high as $25,000 per year.  You could also be sentenced to one year in prison for each unfiled return.  To reduce your chances of a fine or imprisonment, get organized and get your tax returns filed.

Steps for Filing

•    Get your documents together.  Find all your documents and determine if there are items missing.  If there are, you can request copies from the IRS.
•    Prepare the tax returns.  This can be done by yourself or by a tax professional.  They will help you deal with the IRS if it becomes necessary.
•    Be informed.  Believe it or not, you may be eligible for a tax refund.  Do your research and find out the time limits for refunds.  Be aware that if you are due a refund, the IRS will probably use it as payment on your tax debt.
•    Pay your tax debts.  Create a plan that will help you pay your tax debts in full.  If you do not have the funds readily available to accomplish this, you do have other options.  These include obtaining an installment agreement or an Offer in Compromise.
•    Make plans.  With the help of a tax professional, review your financial situation and prepare a strategy to help you reduce your taxes.

To get out from under this IRS Problem, contact our office.  Our knowledgeable staff can answer any of your questions and assist you with the filing process.  The future will look brighter for you and your family when you have the burden of your tax debt under control.  Get in touch with us today. Whether you need Tampa Tax Attorney or anywhere in the United States, we can help.

So you're behind on your tax returns….what to do if you behind on filing your taxes is a post from: IRS Tax Problem Solver Blog - IRS Help

IRS problems arise if you do not file a tax return. The Tax Code has certain timelines or statutes of limitations set out that let the IRS to go after nonfilers.

Criminal: If the IRS finds you within six years of the tax return's deadline, you will be facing criminal charges.

Civil: Civil penalties can be imposed but there are no deadlines. The penalties and interest can be assessed on the taxes you owe forever.

IRS Policy: After six years from the filing deadline, nonfilers aren't often pursued by the IRS.

If you owe taxes and don't file a tax return, it's a crime. You can be fined up to $25000 each year and sentenced to a year in prison for each unfiled year.

If you file your tax return and it states that you owe taxes and do not pay them, there is no criminal penalty. Your tax debt will be subjected to penalties and also accumulate interest, however.
Nonfilers are pursued through:

A program known as Computerized Information Returns Program (IRP) matches information documents against tax returns you have filed. A Taxpayer Deliquency Investigation (TDI) is initiated if no filed tax return is found. You will be contacted with IRS notices, missives, and phone calls, and a revenue officer will inevitably start looking for you.

If you do not respond to 1 of the 4 methods used by the IRS to notify you, others will be tried:

Three written notices from the Service Center within a period of sixteen weeks

A taxpayer service representative will contact you and give you a deadline.

A visit from a revenue officer or agent to give you a deadline and assist you with filing your tax returns (Note: It is legal for the IRS to prepare your tax returns for you.)

Visit from a special agent – undergoing criminal investigation

Instead of putting your head in the sand, why not be proactive? You know your IRS Problems aren't going to go away by themselves. Tampa Tax Attorney, Darrin T. Mish represents clients all over the United States. He can help you get your back tax returns prepared and help you come up with a plan to resolve your IRS Problems for Good! Give his office a call tollfree at (888) 438-6474 for a free, confidential consultation now.

Are you a Non-Filer? IRS Problems could be in your future! is a post from: IRS Tax Problem Solver Blog - IRS Help

Problem? Yes and No. No because you can file ASAP. Yes, because penalties and interest can be fairly steep. (Generally, interest is charged on any unpaid tax from the due date of the return until the date of payment. The interest rate is determined every three months and is the federal short–term rate plus 3 percent. Interest is compounded daily)

(If you owe tax and don't file on time, the total late–filing penalty is usually four and one-half percent of the tax owed for each month, or part of a month, that your return is late up to five months. If your return is over 60 days late, the minimum penalty for late filing is the smaller of $100 or 100 percent of the tax owed)

If IRS has sent you communications that you had to sign for – then your time may be short before they start the process to levy your wages or your bank account. Once this happens you will need to talk to them one way or another, either by calling them or by contacting a tax professional who will call them for you. (I recommend the second option)

If IRS levies your bank account, your bank must hold funds you have on deposit – up to the amount you owe, for 21 days. This period allows you time to solve any problems from the levy or to make other arrangements to pay. After 21 days, the bank must send the money, plus interest if it applies to the IRS. Contact Us (Note: If you own Real Estate or have a Small Business and IRS has sent an intent to Levy, it is best to contact an Enrolled Agent or a Tax Professional as soon as possible).

Your question might be, at this point, "If I did NOT file my taxes, how do they know how much I owe"? Answer: IRS completes your tax return for you; based upon 1099s and W-2 information from your employer. The tax liability that IRS computes stands as the collection amount UNTIL you file your tax return for that year. And of course their tax return almost always generates a higher tax liability then if you had filed your own taxes!

Taxes Will Travel specializes in filing Back Taxes for Individuals. A consent form from the client is necessary in order to obtain income information from IRS for the year(s) in question. Once this task is completed and SS numbers, dependents, deductions, etc information is received the tax return(s) can be completed immediately.

Cassandra is a Registered Tax Professional and Instructor for Basic Tax Classes in the San Francisco Bay Area. Her online tax service http://www.taxeswilltravel.com specializes in filing Back Taxes for IndividualsArticle Source: http://EzineArticles.com/?expert=Cassandra_IngrahamBe aware that at the Law Offices of Darrin T. Mish, P.A. we can also prepare your back tax returns. The posting of this article does not represent an endorsement of this particular author's services.

Back Taxes, You Forgot to File, Now What? is a post from: IRS Tax Problem Solver Blog - IRS Help