Past Due Tax Returns: Three Ways You May Be Missing Out if You Fail to File

Posted on in IRS Issues

Cook County tax law attorney, past due tax returnsAs an individual or a business owner, anytime you neglect to pay your taxes or file incorrectly, you face a number of potential IRS issues. Many of these issues have the power to cost you big dollars, headaches, and lost time. Although collecting all the necessary information to properly file your taxes can be time consuming, fixing IRS issues that resulted from neglect or incorrect filing is often far more time consuming, not to mention stressful. Hence, this is why it is important to get it right the first time around.

Time is of the Essence

If you have fallen behind on filing your taxes, the key is to work with a professional to resolve the issues as quickly as possible, before the problem turns more complicated. The sooner you address your past due taxes, the sooner you can get back to work or running your business. There are multiple advantages to taking care of your past-due taxes as soon as possible. If you continue to wait, you may lose out in the following ways:

  1. Loss of Refund: If the IRS owes you a refund for withholding or estimated taxes, they can hold onto those funds until you file for any past-due taxes. You are required to file your return within 3 years of the return due date in order to claim the money. The IRS will hold your refund until they either receive what they deem to be an acceptable reason for why you did not file or until they receive the return. 
  2. Loan Delays or Denials: If you neglect to file your past-due returns, you may have ongoing issues obtaining all kinds of loans, including those that allow you to refinance, buy a home or car, or even apply for federal aid for educational loans. This also applies to business loans; if you need any kind of financial assistance to get your new venture up and running, you better think twice before applying if you have unresolved past-due returns. Loan approvals can be delayed or denied under these circumstances, as you are required to present copies of your filed returns to any financial institution from which you hope to acquire a loan.
  3. Social Security Benefit Loss: This applies particularly to self-employed individuals. You run the risk of losing your credits toward your Social Security retirement or disability benefits if you neglect past-due returns. If you do not file your federal income tax return, then your income is not reported to the Social Security Administration. This in turn affects your benefits.

Owe More Than You Can Pay? 

Finally, consider one more thought on those past-due returns you have been shuffling under the rug: The longer you wait to pay the IRS, the more interest charges and late payment penalties you will incur. The IRS will often work with you. You may be eligible for an installment agreement, an Offer in Compromise, or you may ask for more time to pay the amount in full. For example, you may qualify to request an additional 60 to 120 days to pay through the Online Payment Agreement application.

If you are feeling overwhelmed by your past due return obligations and want to eliminate mounting trouble with the IRS, explore your options with a knowledgeable Cook County tax law attorney today. Call the Law Offices of Eric G. Zelazny at 708-888-2299 for a personal consultation.

Source:

https://www.irs.gov/businesses/small-businesses-self-employed/filing-past-due-tax-returns

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