412.246.9358 (Pittsburgh), 484.915.3100 (Philadelphia) getrelief@strategictaxresolution.com

Unfiled Tax Returns

Unfiled Taxes and Tax Returns

If a taxpayer neglects to file their taxes every year, the IRS will file a tax return for them using a Substitute for Return (SFR). These filings usually do not contain many of the tax deductions or credits a taxpayer may qualify for. This also may leave the taxpayer with a tax debt. When the IRS sends a “Notice of Demand for Payment” letter, it is an opportunity for a taxpayer to make arrangements for repayment of the tax debt before any IRS collection actions are taken. If a taxpayer fails to reach an agreement with the IRS, the IRS will commence collections.

The IRS has the authority to take collection actions against a taxpayer’s wages, bank account, property, and assets when a taxpayer has an outstanding tax debt. If the tax debt remains unpaid after notification, the IRS will take a variety of measures to satisfy the debt, including:

Therefore, it is essential that all taxpayers are fully up-to-date on all their filings. Strategic Tax Resolution is experienced with helping different taxpayers, such as W2 employees, self-employed filers, independent contractors, and small-businesses file all past years to lower or possibly eliminate a tax debt.

Frequently Asked Questions About Unfiled Tax Returns

How do I know if I need to file a tax return?

Each year the IRS publishes something called the “Publication 17” which contains information about those who need to file taxes. Filing requirements depend on your age, filing status, income, and other small factors. 

What are the consequences of not filing a tax return?

If a person does not file a tax return, the IRS has the ability to charge 5% of your tax due as a penatly. This penalty charge is assessed each month and can climb up to the maximum penalty fine of 25%. In the worst case scenarion you may face jail time and fines of up to $25,000.

What if I lost my W-2 documents and 1099s for the tax year I need to file?

If you have lost your W-2’s or 1099’s call the business or organization that would have these forms on file. Most companies and organizations have these records on file for at least seven years. If you cannot contact your employer contact the IRS directly and ask for a wage and income transcript. 

How does the IRS contact individuals who do not file?

The IRS will send you a notice in the mail at the last address they have on file for you. This letter is reminder that you need to file your taxes and that you may have a balance due when you file. From there you may receive a letter stating that you must file your taxes within 30 days.

What is a substitute for return?

If a person does not file their taxes, the IRS may complete a substitute for return on your behalf. These returns usually assess a person as a higher tax liability.

Do I need to file a return if I do not owe the IRS?

Techincally if you do not owe the IRS, you do not need to file. However this means that you may lose out on your refund and face other consequences that have been stated above.

Are tax penalties deductible on tax returns?

No, tax penalities are not deductible on tax returns.

Can I file a tax return late?

Yes you can always file a tax return late, but only through the mail. You may also receive a penalty for filing your taxes late.

If I am filing a past due IRS tax return can I use the current year's tax forms?

No, you will need to use the tax form for the year that you are filing. You can find most of these forms by visiting the Internal Revenue Service website.

How can I schedule a consultation with Strategic Tax Resolution?

To schedule a consultation with Strategic Tax Resolution please contact us via our main office line (484) 915-3100 or by visiting our contact us page.