Four Steps to Follow When Filing IRS Back Taxes

A free article on Debt Consolidation

By: Manuel Davis Jr

Filing delinquent taxes is difficult and to ensure it is done properly there are a few guidelines you should follow. You have taken the initial step towards resolving your unfiled back taxes just by reading about it. If you do not file, your IRS problems will get worst. People who think the IRS won’t figure out they did not file, they are wrong. Ignoring the IRS can also lead to the IRS filing tax returns for you, while giving you no deductions and they will make sure you owe money even if you normally receive money back.

Prepare Documents

Obtain required documents in preparation to get together tax returns. If the IRS finds you didn’t file a return or returns and decides not to take criminal action they may file a tax return in your name. If the IRS does this, you can be assured they will not give you any deductions you normally take and you will have a higher amount owed to the IRS than if you were to file on your own. If the IRS has submitted a return under your name, suggested you amend that return with the help of a tax professional to lower your tax bill. The IRS Substitute Return tax return will have to be done over to take deductions you are permitted to save money. If you can’t find relevant tax documents, it is a good idea to contact the Internal Revenue Service to get all of the required documentation you will need to file. To file or amend a filing you need tax documents such as a W2, 1099 as well as other documents supporting any deductions you claim. IRS form 4852 can be used to substitute W-2’s if you cannot obtain from the IRS or employers.

Find a Good CPA, Tax Attorney or Enrolled Agent

After you have all of your relevant documents, get in touch with a qualified tax professional. When hiring a tax specialist it is best to work with a firm that will file tax returns for you and will negotiate. Otherwise, the process becomes delayed and you may not be able to obtain the best outcome because the tax services are being broken out between two firms.

Work with the Tax Firm you Chose to File Back Taxes

You only have to file tax returns for the last seven years. Your tax filing professional will contact the IRS to let them know you will be filing a delinquent tax returns. Once the returns are filed, you will be back into good standing with the Internal Revenue Service. There will be charges for using a tax relief company, but on average people that use tax companies end up saving more money after fees are considered. After you file your tax returns you will know how much you owe the IRS.

Recognize your Options when it Comes to Paying your Tax Debts

If you cannot pay the tax amount owed, work with tax relief firm so they can examine your monetary situation to find the best way to settle for you. In rare cases, you can submit an Offer In Compromise (OIC), however, this option is only available if the IRS is unsure your liabilities are correct, or they don't think you can pay--it is rare to get an Offer in Compromise approved. If your tax relief company feels there is no way to reduce your tax debt, and you can’t pay the total amount owed now, then you can request an installment agreement which will allow you to pay off the tax amount owed over a 3 years period. If you owe more than $25,000, your tax professional will complete and send in form 433F, and an installment agreement request on your behalf.