FILE your past due returns even if you cannot pay in full your . And file the returns the same way you file if you file on-time.
Let me tell you why you should file your past due returns now?
• Substitute return. If you do not file voluntarily the IRS will file a substitute return for you and you could lose credits, exemptions, and deductions available to you. You will receive in the mail Notice of Deficiency CP3219N, a 90-day letter, proposing a tax assessment.
• Collection. The IRS can send you a tax bill to start the collection process. And may levy wages, bank account, worst you could be subject to enforcement measures like criminal prosecution.
• Penalties and interest. If you file your past due returns now and pay taxes owed it will limit your interest and penalties from late payment.
• You don’t file you lose your refund. You need to file your return within three years from due date to claim for refund, earned income credit, overpayment from estimated taxes and overpayment from income tax withholdings or you lose it.
• Social Security Benefits. Non-filing your return would mean any self-employment income you earned will not be reported to the Social Security Benefits Administration and therefore no credits toward your disability benefits and social security retirement.
• Issues in Obtaining Loans. Banks and mortgage lenders require that you submit copies of income tax returns when you want to refinance your home, buy a new property, personal or business loans, and apply for federal aid for higher education.
• You owe taxes and cannot pay in full. You learned or you know you have taxes owed you cannot pay in full. Request for installment agreement or if you qualify request for offer in compromise. Call 1-800-829-1040 if you need assistance to utilize the IRS online payment agreement tool. If none works and you are stressed, seek assistance from your tax professional.
Complete Form 4506-T to request for transcript of tax returns if filing your past due returns and you need wage and income information for the preparation of the returns. And call 1-800-829-1040 or 1-800-829-4059 for filing help or seek help from your tax processional.
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Disclaimer: Any accounting, business or tax advice contained in this communication is neither intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties.
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Al-os & Associates Accountancy Corporation provides accounting and tax services to individuals, corporations, LLCs and business entities. The Firm has a niche in defending taxpayers audited by the IRS and other governmental agencies.