Past Due Tax Returns and Your Options
Many individuals face past due tax returns for a multitude of reasons. This can range in severity from a late filing or late payment to years of unfiled tax returns. The most common reason for not filing a tax return and owing past due tax returns is simply the inability to pay the debt. Even when you owe the IRS a substantial amount of money, it is not hopeless. There are several options that you may have to settle your past due tax problems.
Before you can take care of past due tax liabilities, you must take care of filing past due tax returns. Filing the missing return or returns is the only way to get back on track with the IRS. When you don’t file, the IRS will create a substitute return for you. Do you really want your tax liability to be an uncontested account that the IRS creates based only on possible income statements? There are likely many deductions, credits, or claims that you may have provided on your return to reduce the amount that you owe. Plain and simple, complete and file the past due tax returns.
Once your tax liability is properly assessed, you may be able to work with the IRS to make monthly payments in an Installment Agreement or even negotiate an Offer in Compromise to settle your debt with a lump sum payment for less than the full amount owed. There are other options that you may have to help you reduce your tax debt. Unfortunately, until the past due returns are filed, you will not be able to use any of the options available.
If you need assistance in preparing the past due tax returns, a certified tax professional will be able to instruct you on your rights, provide you with all the tools that you need to complete the return, and negotiate with the IRS on your behalf. When it comes to knowing what your options are and best protecting your interests in finding the right option to settle your tax debt, these professionals can really do all of the work for you.