Why Do You Need to File Past Due Tax Returns?
Not filing taxes with the IRS can result in late filing and payment penalties, additional interest on taxes owed, and possibly losing a refund.
Individuals who are self-employed and do not file a federal tax return will also not receive valuable credits that go towards determining how much they earn in Social Security benefits when they retire.
Lenders often require people taking loans to provide several years of filed tax returns for income verification purposes as well. When you do not file a tax return, qualifying for a home mortgage, home refinancing, or business loan may be more difficult.
How Late Can You File Taxes?
Every year, the IRS sets a deadline for filing federal tax returns and paying taxes. Typically, that deadline is in mid-April.
Many people cannot make the filing deadline for various reasons. If you cannot file your tax return before the April date, the IRS allows taxpayers to file an extension. In most cases, the IRS automatically approves extension requests.
Taxpayers who file for an extension then have until mid-October to file their federal tax return without incurring a Failure to File penalty. Keep in mind that even with an extension to file your return, you must still pay any taxes you owe in April.
When you miss the April tax deadline, do not file for an extension, and you owe taxes, the IRS will start charging a monthly 5% Failure to File penalty plus a 0.5% Failure to Pay penalty on unpaid taxes until you pay off your tax debt including interest and penalties.
For both penalties, the amount for each will not exceed 25% of your tax debt.
What If You Haven’t Filed a Tax Return Because You Can’t Pay the IRS?
Even when you do not pay, the IRS will eventually discover that you did not file a tax return and owe taxes when their system receives W-2s, 1099s, or other income documents with your SSN or TIN.
In addition to penalties discussed above, the IRS may also file a substitute tax return when you do not submit a federal return if they have the W-2s or 1099s needed to complete a 1040 for you.
However, IRS substitute returns will not include credits or deductions you may be eligible to receive, so you may lose a refund or owe more taxes.
If you owe the IRS after they file a substitute tax return, you can either pay what you owe or appeal the decision within 90 days of receiving a balance due notice.
Bottom line, it is best to file and set up an IRS payment plan when you cannot pay taxes. Not filing will only lead to you owing more taxes after penalties and interest are added to your balance.
You may also have your wages garnished, bank accounts seized, or a tax lien placed on your property to offset your tax debt.
How Do You File Tax Returns for Previous Years?
For help with filing back taxes for previous years, the IRS recommends that you call them at (800) 829-1040. Some taxpayers may also qualify for additional IRS assistance with filing past due returns through the VITA (Volunteer Income Tax Assistance) or TCE (Tax Counseling for the Elderly) programs.
What If You Don’t Have Income and Other Tax Documents to File Past Due Returns?
There are three good ways to get wage or income information if you are filing a past due tax return and you don’t have it:
- You can use IRS Get Transcript online at https://irs.gov/individuals/get-transcript. Here you can view your Wage and Income Transcript for W-2s, 1099s, 1098s, and 5498s.
- You can complete IRS Form 4506-T. Check the box on line 8 for “Form W-2, Form 1099 series, Form 1098 series, or Form 5498 series transcript.” Mail or fax the completed form to the address or fax number based on the 4506-T information for where you live.
- You can contact your employer or payer to get copies of W-2s and 1099s.
Where Do You Send Past Due Tax Returns?
You can see where to send your past due return at https://irs.gov/filing/where-to-file-paper-tax-returns-with-or-without-a-payment. Each state has a separate address for mailing paper tax returns to the IRS.
For example, if you live in California and owe taxes, you will send your return to the IRS office in Cincinnati, OH. However, if you live in California and do not owe taxes or are eligible for a refund, you will mail your return to the IRS office in Ogden, UT.
To confirm whether a past due tax return should be sent to a different address than what is listed, call the IRS at (800) 829-1040.
Can You e-File Back Taxes?
Only tax preparers with access to the IRS Modernized e-File system can file past due returns electronically for you. Otherwise, you will need to print and mail your return to the IRS when it is past due.
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