Why Should You File Your Past Due Returns Now?

Why Should You File Your Due Returns Now?

The Internal Revenue Service (IRS) sends one or more notices to you when you fail to file your tax returns on time. These notices contain detailed information about your past due returns and guidelines of what you need to do to file your returns and become compliant. If you get these notices from the IRS, then you should file your due returns as soon as possible; otherwise, you can face many problems in the near future. If you have unfiled NYS tax returns, it would be wise to file a NYS Voluntary Disclosure and get caught up using that program

Regardless of whether you can pay the full amount of your due return or not, file all your tax returns otherwise you will be in big financial trouble with little hope of reducing the penalties once they catch you. Here are some reasons why you should file your tax returns now.

Reasons to Files Your Due Tax Returns On Time

An unfiled return poses several risks. It is a headache for a taxpayer. It can occur for several different reasons such as family emergencies, illness, financial inability to pay the tax owed, and many more. The occurrence of it always leads to a huge loss and therefore, it is always better to file the return on time. 

Avoid Interest and Penalties

As an taxpayer, the IRS charges a certain rate of interest and penalties for late payments for unfiled returns. If these are added to your balances owed, the actual amount of taxes owed is almost double. The rate of interest on unpaid tax returns increases every month and the penalties accrue. Therefore, every taxpayer wants to avoid these penalties and interest. If you want to avoid or reduce interest and penalties on your tax returns with a balance owed, then file them now. If you are finding difficulties in this legal procedure, then you can look for unfiled tax returns help. A certified professional tax attorney or tax law firm can help you file your returns as soon as possible. 

Avoid Criminal Charges

Of course, you will never want any type of criminal charges imposed on you. You may have clean record, but if you don’t pay your taxes on time, then you can be penalized under the criminal act as not filing taxes on time could be criminal activity if done intentionally and without a solid reason. And once you are charged under the criminal act, then you will face so many problems for a lifetime. Therefore, it is better to file your taxes on time or file and create payment plans for what you cant pay and be on the safe side 

Get Your Refund

The IRS holds your refund and applies toward a balance owed. You risk losing the refund if you don’t file. According to the tax law, you must file your past tax returns to claim your refund for withholding or estimated taxes within three years of the return due date. This rule also applies for certain credits. 

So, make sure you file your tax returns for the previous years because after only then you will be able to receive your refunds. 

Protect Social Security Benefits

The social security administration runs the social security benefit. If you do not file your federal tax returns, but owe social security taxes, you will not be able to take the benefit of these social security benefits since you did not pay into the system. This would absolutely be a huge loss for you. To protect your social security benefits, you need to file your tax returns on time since late filed returns are only allowed on a limited basis to count toward your social security base. 

Obtain Loans Without Having Any Issues

You can face many different issues while obtaining a loan from a bank or a loan provider if your past tax returns are not filed. A copy of filed returns needs to be submitted to the financial institution (bank or other loan providers) for obtaining a loan. Without it, financial institutions cannot approve you for a loan. 

These are the top five reasons why you should file your past return now. If you fail to do so, you will certainly face all these things. Eventually, you will be at a huge loss. Therefore, it is better to pay your taxes on time. If you find any kind of difficulties in filing your returns, you can take legal assistance from a tax attorney or a tax law firm. They will guide and help you the best way. 

What If You Owe More Than You Can Pay?

In the case where you owe more than you can pay, then you can request an extension of 60-180 days. This is the special provision for special cases. You can make a request either through an online payment agreement application or by calling a toll-free number. If its a large balance, you can also choose the Installment Agreement or Offer in Compromise options. If you don’t have enough understanding of these provisions, you should look for unfiled tax returns help.