If you earn income, you must file tax returns every year. April 15th is the traditional deadline for filing tax returns, but that deadline sometimes is moved back a day or two. If you have unfiled tax returns, you cannot get a refund until you file, and the sooner the better, as 90% of income tax refunds are issued within three weeks, according to the IRS. Here’s a closer look at why you shouldn’t ignore an unfiled tax return.
Interest and Penalties
If you paid more in taxes than you owe for a given year, you do not have to file your tax return before the annual deadline. But if you do owe the IRS money, it will levy interest and penalties on the amount owed. The best tax lawyers can help you to minimize the potential interest and penalties, but it all starts with filing any unfiled returns as soon as possible.
Loss of Unclaimed Tax Refund
Even if you are owed a refund, the IRS might not pay it if you wait too long to file your tax return. The best tax lawyers might help you to receive your unclaimed tax refund if you have a good reason for missing the filing deadline. A catastrophic accident, serious illness, or deployment overseas if you are a member of the U.S. military are common examples of reasons the IRS might accept for missing a tax deadline.
Potential Tax Levies and Liens
If you don’t file your taxes, the IRS can review the W2s provided by those who paid you for work and determine the tax amount. If the review shows you owe taxes, you will have to pay additional penalties and interest. If you owe a lot of money, the IRS might place a lien on your property, which might require the help of a tax lawyer in your area to remove it when possible.
Possible Criminal Charges
The worst-case scenario of ignoring unfiled tax returns is the potential for being charged with federal crimes. Notorious mobster Al Capone was sentenced to prison for income tax evasion, and so have other high-profile individuals over the years. Filing your unfiled tax returns can help to prevent that from happening to you.
For more information on your tax return, contact Michael C. Whelan JD CPA today. We are happy to help you and answer all your questions!