5 Tips for Dealing with Unfiled Tax Years

Dealing with unfiled tax years can be difficult and overwhelming. When you find your tax return is overdue, the best thing to do is take action as soon as possible. Here are five tips to help you get back on track:

1. Don’t Ignore Unfiled Tax Years

Ignoring your unfiled tax years won’t make them go away, as the Internal Revenue Service has up to 10 years to collect on unpaid taxes. It’s important to address any unfiled tax year(s) as soon as possible to avoid potential penalties and interest fees.

2. Get the Necessary Paperwork Together

To successfully file back taxes, you’ll need to obtain all necessary paperwork for each year that needs to be filed. This includes W-2’s, 1099’s, and other relevant documentation such as receipts or bank statements. If you’re missing any of these documents, you’ll need to contact your bank and employer(s) to get copies.

3. Calculate Interest & Penalties

The IRS charges interest and penalties for any unpaid taxes, which can be quite substantial depending on the amount of back taxes owed. You can use an online calculator to estimate how much you’ll owe in interest and penalties before filing your back taxes.

4. File Tax Returns with the Help of a Professional

If you’re overwhelmed or struggling to figure out how to file back taxes, it may be beneficial to hire a tax professional for assistance. A qualified tax professional can help you navigate the process and make sure that your taxes are submitted correctly and on time.

5. Consider Payment Options

If you can’t pay your back taxes in full, you may be able to set up an installment agreement with the IRS or use other payment options such as an Offer in Compromise. It’s important to do your research and understand what options are available before filing back taxes so that you can make the best decision for your financial situation.

Filing back taxes can be a stressful and daunting task, but taking the time to understand your situation and knowing what options are available can help make the process easier. With these five tips for dealing with unfiled tax years, you’ll be better prepared to tackle any outstanding taxes you owe.

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