The time has come and gone to file federal taxes and even if you haven’t yet filed with the IRS, it is still possible that backs taxes be filed for your benefit.
Obviously, it’s best to pay off IRS back taxes as quickly as you can. The current approach of the government is to allow each tax payer to file their returns voluntarily. However, this doesn’t mean that payment of those taxes isn’t mandatory. While participating in the voluntary filing of taxes, on time or otherwise, the tax payer has the option of applying a number of deductions and Earned Income Credit to their paperwork. If you do not participate in voluntary filing, the IRS has the option to file for you, and without any exemptions or qualified deductions. This means that the substitute return filed can hit your finances twice as hard. The estimated amount is probably going to be higher than the return you would’ve filed yourself. The IRS may then put liens on any property you own, or levys on your financial accounts and even wages until the amount owed is paid off.
When paying IRS back taxes, any form of credit card and loans are accepted, and you may even negotiate an installment account with them. When considering your options, the IRS recommends a bank loan or credit card payment, as the installment plan will usually end up costing more. The limit is three years to file IRS back taxes, starting from the day they were due to receive refunds. After this three year limit, your refunds will expire, so it is a good idea to file as soon as you can. Any refunds owed to you can even be used as payments toward IRS back taxes you may owe.
Not all of the IRS back taxes require payment. It is understood that sometimes people are late simply because of life occurrences or because they assumed they would owe money and then find out they don’t. Whatever the case, it is important to file all back taxes with the IRS quickly. Remember that the processing of back taxes doesn’t take place at every IRS location, so know the address where you need to send your returns or you may receive further penalties and interest in a mail delay. If you happen to have an official IRS notice about your back taxes, send your return to the address listed on that notice for fastest processing. The website www.irs.gov has prior instructions and forms dating as long ago as 1990, and the information on where to mail returns.
Filing taxes is always a fairly tiring experience, but uncertainty does not need to cause a delay in your filing. The IRS offers assistance for low to moderate income households via a Volunteer Income Tx Assistance Program. Also, all tax payers over the age of 60 can find help with a Tax Counseling for Elderly program. These two programs are of course free for anyone who qualifies, and offer you IRS tax filing training. This way, you can avoid filing IRS back taxes completely.