I haven’t filed a tax return in years. What should I do?

Like all tax problems, this one is not going away, it needs to be dealt with sooner rather than later. You’ll sleep better! I always “joke” that the IRS is the only of your creditors who can literally put you in jail. So don’t play around with them! Though you may get away with it for a time, a delinquency investigation could show up on your plate at any time. Better to get out in front of it!

Besides, you may be leaving money on the table! Over 70% of tax returns filed result in a refund. But you don’t get your refund if you don’t file your return, and if the return is more than three years late, then you have already forfeited your refund.

Also keep in mind that the Failure to File penalty is much greater than the Failure to Pay penalty, so you should never delay filing your return because you “don’t have the money”. Besides, the IRS can (and does) often file a return for you, called a “substitute return”. But not surprisingly, they may not give you all credits and deductions that you are entitled to. Additionally, there are plenty of payment options available for a taxpayer who owes taxes but can’t pay them immediately, and a professional representative can help you to explore these options.

But do I need to file ten or twenty years of tax returns if I have not filed for that long? Thankfully, the answer is no. Generally, you only need to file returns for the past six years to be considered “compliant”.

So when do I need to get a professional involved? Honestly, probably more often than not. First, pros are set up with all of the past year tools and knowledge needed to file older returns, which may be more difficult for you to come up with. Second, past-due returns generally involve many other issues, such as penalties, interest, and payment arrangements, that a pro can help you to navigate. And you’ll feel so much better having a plan to get you back on the “sunny side of the street”, leaving your tax worries behind!