It is an offense under federal law if you fail to pay or file previous year taxes. Most times, you get fined and you could end up in prison. If you owe taxes or skipped filing your taxes, make sure you get this done. To accomplish this you need to gather the relevant information as well as paperwork. Complete the necessary forms and forward them to the IRS. More so, consult with a tax attorney if you need professional advice and help file the previous tax year.
Why Do You Need To File Your Previous Year Taxes?
There are many benefits that come with filing your back taxes. You will reduce charges on interest, penalties, and fees if file your taxes early. The truth is; when you do this you save yourself from the hand of the law. Remember, you could end up owing more if you fail to file your taxes. More so, you save yourself from losing your tax debt relief options.
Step-By-Step Guide on How to File Previous Year Taxes
The first step towards filling your previous unfiled years is to find out what documents are necessary. You can consult with one of our tax lawyers if you don’t know what to do.
1) Find out the exact number of years you are unfiled for.
This is important to avoid over or under filing previous year taxes. Thus, you need to look at your records. Take a look at copies of your previous tax filings, refunds, and receipts. This is one of the best ways to determine the exact number of years you have unfiled. If you cannot determine the exact number of years, contact the IRS for clarification. We offer a Tax Investigation; this will obtain records for 10 years and IRS transcripts. We will then go back through your history to see exactly what needs to be accomplished to get you back on track with IRS.
2) Gather Income documents
To file past year’s taxes, take a look at your old documentation like W-2s, 1099 or 1098. These documents will help you with your income information. If you cannot find them, contact your employer although there is no guarantee they will help.
Usually, when you are employed, you will receive a W-2 form at the end of every working year. This document has information about your wage, salary, and amount paid in tax.
If you have student loans or other loans, you are given form 1098 if you paid school fees and.
If you collect a pension as well as dividend income or have a contract job, you will get 1099 forms.
3) Contact the IRS or Form 4506T for Missing Income Documents
Chances are that you might not find all the necessary documents you need to file the previous year’s taxes. If this happens, call the IRS or use form 4506T. With this form, you can request for relevant information found on the forms in step 3.
Understand that the IRS will not send you duplicated copies of this document. Rather, you will get the necessary information that will help you in filing your back taxes.
We also conduct a service called a Tax Investigation that wills 1. Get you protected and 2. Find out exactly what you owe and for what years. We are also able to obtain IRS transcripts giving our firm detailed information about the last 10 years’ history.
Things You Should Know Before Filing Previous Years Taxes
Once you have all the relevant documents and information, you can start to file your back taxes. Here are a few things you should know before filing your previous year’s taxes.
#1 Understand the Different Methods You Can Use To Prepare Your Previous Year Taxes
To prepare your back taxes, you can either do it by yourself or seek professional help.
If you want to do it yourself, you can pay per year through different internet services or use the previous year tax filing forms on the IRS website, all you need to do is follow the step by step instructions. If you use online services to prepare your previous year taxes, you have the option to e-file them otherwise you will have to mail it to the IRS.
In the case that you mail your tax form to the IRS make sure you mail the forms to the address that the IRS provided. If you are confused go to the IRS website for specific instructions.
In a situation where you cannot do it yourself, call us for professional help. We have tax lawyers, and enrolled agents that can help you file complex previous year taxes.
Benefits of filing previous year taxes with professionals: Usually, preparing your previous year taxes with a professional, he/she will file directly with the IRS and have your tax problem resolve faster.
#2 Decide On Payment Options and a Plan That Is Precise For You
If you owe taxes that you cannot clear at once, request for a grace period of 60 to 120 days. You will need to call the toll-free number 800-829-1040. If you cannot pay within the grace period, request a payment plan with the IRS. With this plan, you can clear your tax debt with installment payment till you clear your debt with the IRS. You can only do this if you have filed your back taxes. You can work with a tax lawyer to come up with a plan. Your plan should focus on payment by monthly installment.
In the case, when your debt exceeds $50,000, you need to complete and submit forms like the 9465 and 433-F. It’s best to have a tax lawyer help you with this complex process because it requires legal knowledge of tax law. Furthermore, tax lawyers can help you reduce tax debt.
#3 Benefits of paying the principal amount
Paying the principal amount can help to reduce the interest rate. To do this, you can either write a check or do an electronic transfer. More so, you can make payment via your debit or credit card. Doing this will help you reduce your tax penalty and interest on the money you owed.
#4 reduce Your Penalty and Fees by negotiating with the IRS
You can negotiate with the IRS to pay less than you owe. This is known as an Offer in Compromise. To start the process you will need to fill the pre-qualifier form to find out if you qualify for the Offer in Compromise. There are other programs that we exercise for taxpayers like the fresh start program or abating the penalties.
Make sure you list all your expenses for each month such as obligations like insurance, food, gasoline, clothing, rent, mortgage payments, and other expenses. You will also be required to pay an application fee of $168 (price may vary by filing year). The IRS will only review your application if you meet their criteria.
#5 Work with Tax Professionals to File Previous Year Taxes
If you want to successfully file previous year taxes you will need some legal knowledge and legal knowledge in filing back taxes. To file the previous year’s taxes, you will need to use the correct form from the IRS. So, it is best to seek help from a tax relief company that has certified enrolled agents and tax attorneys to help you go through the process quickly so you do not have to pay penalty and interest for owing money to the IRS.
For immediate help in filing previous year taxes, call us now for a free case evaluation.