- The IRS understands that there may be legitimate reasons why may don’t have the money to pay your taxes, but there are very few legitimate reasons for not filing your return when due, and not having the money to pay is not one of them.
- Late filed returns incur a penalty of 5% per month to a max of 25%.
- Failure to file can result in criminal prosecution
- Until you file you will always be worrying what the IRS will do and when they will prepare and file a return for you. The IRS won’t prepare a return for you if it will result in a refund.
- You only have 3 years from the due date of the return to claim a refund of estimated or withholding taxes you paid.
- IRS prepared returns are individual returns. They are prepared from the W-2’s and gross amount on the 1099’s they have on file. The IRS prepared returns are either married filing separately or single, with the standard deduction and 1 exemption. They are not prepared jointly or as Head of Household. There are no adjustments to income for IRA rollovers, no consideration for the purchase price or basis of property or investments you sold, no itemized deductions or deductions for business expenses and no exemptions for your spouse and other dependents.
- Trying to prepare a return after several years and after the IRS prepares a return can be difficult especially if you are self-employed. It may not be easy to find to find all the required documentation. Records are lost and while w-2 and 1099 income is reported to the IRS, records of expenses and deductions can be lost, misplaced or destroyed making it difficult to satisfy the IRS requirements for documentation Records lost and while w-2 and 1099 income is reported to the IRS, records of expenses and deductions can be lost misplaced or destroyed making it difficult to satisfy the IRS requirements for documentation.
- Eventually all your returns will end up being filed by you or the IRS.
So exploit the inevitable… get started now and give us a call if you need help.
One last thought. Should you file separately or jointly, especially if there will be a balance due or you are concerned about an audit? Folks will tell you to file jointly because your tax bill will be less than filing separately and the chances of being audited are pretty low. But remember it’s not what you owe it’s what you pay and do you want to expose your joint assets to collection?
Call us today for a Free no obligation consultation 703-847-0757