You Have a Late Tax Return – Now What?

This post is in: Blog, Business
No Comments

late_tax_returnYou let one return slip by, maybe completely innocently. You moved, you lost your business, you had a loss in your family…something happened that got you off track. And your figured a tax return was the last thing you needed to deal with. So, you didn’t. Deal with it, I mean.

Maybe you had a few middle of the night panic attacks after you missed a filing deadline but, you reasoned, you lost money anyway so how bad could it be? Or you thought you owed taxes and knew you didn’t have the money, so you were going to forget about the returns and get to work earning money first. That way you could pay your CPA to prepare your return, you could pay the government the taxes and even pay a lawyer if it got really bad.

And then another year went by. You’re still trying to get back on your feet and make the money you know you need to pay taxes, accountants and lawyers. The IRS hasn’t found you yet, maybe it’ll be okay.

By the third year, you know you can’t file because if you do, it’s going to raise a flag on the other past years. Besides, you’ve moved, had a flood, a fire or just done an over-exuberantly housecleaning and you don’t know where the files you need are.

Maybe they’ll never find you. You hope.

I talk to a handful of people in this spot every year. There is a way to get back into the system so you can have credit, a business, real estate and a bank account.

What got you here isn’t going to get you out, though. You have to do something different. In fact, you probably are going to need to take massive action. That’s because if you come forward before the IRS finds you, you’ll have a much better chance of negotiating a deal and reducing the penalties.

If you or someone you know is in this spot, encourage them to fix it. Hiding won’t make it go away. Hiring a pro and cooperating to get the records together will.

Leave a Comment