Should I Hire a Tax Professional for Unfiled Returns?

Taxpayers frequently miss the deadline for filing their tax returns, with millions of returns going unfiled every year. Even though it’s common, you should still do everything you can to get your returns filed on time; otherwise, you’ll have to deal with IRS penalties and interest charges on the balance you owe. But getting caught up can be intimidating. If you’ve missed a year or two of filing your returns, should you handle it on your own? Or hire a tax expert to help you? This guide walks through when it’s a good idea to work with a professional for unfiled returns. The Timothy S. Hart Law Group is always here to help when you need to file past-due returns or have questions about failure to file penalties. Get in touch with our expert attorney today. Key takeaways

• Taxpayers commonly have unfiled returns due to missed deadlines, fear of their tax bill, or a lack of understanding of tax obligations.
• If you haven’t filed and are owed a refund, you only have three years to claim your money.
• You may not need a tax professional if you don’t owe taxes, you understand your obligations, or you aren’t required to file a return.
• Hiring an expert is a good idea if you have complex business taxes, you owe a lot of back taxes, or you’re facing serious collection actions like liens and levies.
• Tax professionals like attorneys, CPAs, and enrolled agents can help you set up payment plans, negotiate settlement agreements like an offer in compromise, and avoid asset seizure through IRS levies.

Reasons for Unfiled Tax Returns

It’s easy to let tax obligations go by the wayside when life gets busy or you’re dealing with financial issues. Take a look at these common reasons taxpayers have unfiled returns:

• Accidentally missed the filing deadline
• Lack of organization
• Lack of understanding of filing requirements
• Fear of the tax bill
• Inability to pay taxes owed
• Major life events, like an illness or job loss
• Complex tax requirements

Whatever your reasons for not filing, it’s important to understand the consequences of failing to file when you should have. The IRS will send you notices outlining penalties charged, and they could even file a substitute for return (SFR) on your behalf to assess taxes.

When You Might Not Need a Tax Professional

You may be considering working with an expert to get back in good standing with the IRS. But when is it more valuable to handle things yourself? Here are situations when you may not need an expert for unfiled tax returns:

You Only Missed One Simple Return

If you missed the tax filing deadline, and it’s your only outstanding return, you may not need a professional. This is especially true if your tax circumstances are pretty simple, and the only issue is the unfiled return.

You Understand Your Obligations

If you know what you need to do and understand basic tax law, you may be fine to go without expert help. You can simply submit your tax return and cover any penalties that were incurred after you filed late.

You Aren’t Required to File

The IRS outlines income thresholds so that some people may not be required to file a return. For instance, if you’re under 65, you’re single, and you made less than $14,600 in 2024, you don’t have to file. However, there are other events (such as earning more than $400 in self-employment income or owing FICA taxes on tips) that can trigger a filing requirement. If you’ve received a 15103 non-filer form and you weren’t required to file, you may want to reach out to an attorney to get help drafting your response to the IRS.

You Can Afford Your Taxes

Finally, if you know that you can easily afford what you owe, you may not need professional help. However, if you’re staring down a big bill, you may want to talk with a tax expert about your options.

When You Should Hire a Tax Professional for Unfiled Returns

Some tax situations are hard to get out of on your own. Consider these examples of when it’s definitely worth it to hire a tax professional for unfiled tax returns:

You Owe a Lot of Back Taxes

One of the most common issues for taxpayers is owing back taxes they can’t get on top of. This can easily lead to unfiled returns. When you can’t afford to pay off your tax debt in full, a tax expert can help you understand and apply for resolution options, such as:

• A payment plan (installment agreement) to pay off your balance in monthly installments
• An offer in compromise (OIC) to settle your debt for less
• Currently not collectible (CNC) status, which is a temporary hold on collections
• Penalty relief, including reasonable cause or first-time abatement
• Innocent spouse relief when you file jointly and your spouse made an error

You may not be aware of all the relief options out there, so talk to a tax attorney about what’s right for you.

You Have a Complex Business Situation

Taxes can be more complicated for self-employed individuals and business owners, who have to carefully report all income from the year, as well as expenses and depreciation. The wrong approach can unnecessarily increase your tax liability for the current and/or future years. Even if you have a regular W-2 job, maybe you’re bringing in side income and received a Form 1099. These situations can make filing your taxes seem overwhelming and confusing. A tax expert, like an attorney, can easily help you understand your obligations and current tax law.

You Need to Negotiate with the IRS

If you have a large balance and need to request relief in the form of penalty abatement, an OIC, or other option, a tax professional can negotiate on your behalf with the IRS. You don’t want to approach these discussions on your own, as an attorney can ensure you get the best terms for your situation.

You’re Facing IRS Collections

If you don’t file your tax return on time and you owe money, the IRS may file a substitute for return to assess the tax, and then, the agency will ramp up its collection actions the longer you wait. Talk to a professional right away if you receive a notice about penalties you don’t understand, federal tax liens, or an intent to levy your property. You don’t want your assets or wages to be at risk of seizure.

You’re Worried About Criminal Exposure

Generally, not filing is not a crime, and it’s only subject to civil penalties. However, if the IRS believes that you have willfully not filed in an attempt to evade paying taxes, the agency may refer your case to Criminal Investigation, and you may face criminal charges and possible imprisonment. In these situations, you absolutely need a tax attorney.

Quick Guide to Hiring Help with Unfiled Returns

The reference guide below will help you understand when you can handle unfiled returns yourself or with a preparer versus when to hire an expert like a CPA, enrolled agent (EA), or tax attorney.

Scenario	Handle it yourself	Consider a tax expert
When to Hire a Professional for Unfiled Returns:
One unfiled tax return	✔
Multiple years of unfiled returns		✔
You have self-employment income or own a business.		✔
You have significant investment income		✔
You itemize deductions		✔
Affordable tax liability	✔
Significant tax liability		✔
The IRS has generated a substitute for return, and you disagree with the details		✔
You’re facing criminal charges for not filing.		✔

Of course, even if your situation is simple, you should still contact a tax professional if you’re confused about what to do or are worried about your unfiled returns. An expert can help you get out of trouble so you don’t receive any additional tax penalties.

Contact IRS Tax Pros for Unfiled Returns

The longer you wait to file your tax returns, the larger your tax balance will become. If you owe a lot of money or are dealing with a complex situation, contact a tax professional to reduce risks and protect yourself. When you decide it’s time to get professional help for unfiled returns, our attorney, Tim Hart, is here to help at the Timothy S. Hart Law Group. He can help you negotiate with the IRS, get your unfiled returns filed, set up a payment plan or OIC, and get on top of penalties through abatement. Reach out to Tim Hart to schedule a free consultation today.

FAQs About Unfiled Tax Returns

Do I Need an Attorney If I Miss the Tax Filing Deadline?

If you miss the filing deadline but know what you need to do, are owed a refund, or are able to pay your tax bill, you may not need to hire professional help to get the matter resolved.

When Do I Need a Tax Professional for Unfiled Returns?

If you’re dealing with a complex tax situation, such as running a business, or you want to negotiate a payment plan or offer in compromise with the IRS, it’s a good idea to contact a tax professional, such as an attorney. It also may help when you are afraid you can’t afford your tax bill and are looking for relief options.

How Can a Tax Attorney Help Me With Unfiled Returns?

A tax attorney, as well as a CPA or enrolled agent, can help you understand tax laws that apply to you, manage your tax debt through a resolution option like a payment plan or OIC, and negotiate with the IRS on your behalf. If you have a lot of penalties, a tax expert can help you pursue abatement. An attorney will also ensure your assets don’t get seized if you’re facing more serious IRS collection actions.

How Long Do I Have to Claim a Tax Refund for Unfiled Returns?

You only have three years from the original tax filing deadline to claim a refund. If this date passes, you should still file your return to stay compliant, even though you won’t receive your refund. Sources: https://www.irs.gov/individuals/check-if-you-need-to-file-a-tax-return https://www.irs.gov/newsroom/filing-season-statistics-by-year https://www.irs.gov/filing/time-you-can-claim-a-credit-or-refund