To deal with your prior tax returns, we will start by filling out a Form 2848 “Power of Attorney”. We will use that to obtain your Wage and Income Transcript for each tax year from the IRS as a basis to see what is reported against you and what you have to file on each year’s tax return.
HERE IS THE BASIC RULE GOVERNING TAX RETURNS.
- The IRS has three (3) years to audit your tax return once you file it.
- The IRS has ten (10) years to collect the tax you owe.
- The IRS can’t throw you in jail if their collection measures fail.
IT IS THEREFORE IN YOUR BEST INTEREST TO FILE YOUR TAX RETURNS
BUT WHAT HAPPENS IF YOU HAVE NOT FILED IN TEN YEARS?
There is an IRS policy statement found under P-5-133 to require only the last six (6) years of taxes to be filed. The exact quote is:
“Normally, application of the above criteria will result in enforcement of delinquency procedures for not more than six (6) years. Enforcement beyond such period will not be undertaken without prior managerial approval. Also, if delinquency procedures are not to be enforced for the full six-year period of delinquency, prior managerial approval must be secured.”
WHAT HAPPENS IF I CAN’T PAY THE TAX I OWE FOR MY UNFILED TAX RETURNS?
There are many mechanisms we use to place you in a comfortable position. We will utilize one or more of the following tools to reduce or eliminate your tax.
- Installment Agreement utilizing National Standards for expenses against your income
- Offer and Compromise where you make the IRS an offer to compromise (wipe away) your taxes
- Reduction of penalties for reasonable cause exceptions
- File under Doubt as to Liability procedures to eliminate the IRS filed return they filed on your behalf called a Substitute for Return (SFR)
- Negotiate with the IRS to place your account in a NOT COLLECTIBLE status.
Contact us to resolve your unfiled tax return issues.
