You've gotten caught not filing all your tax returns. It can be frustrating trying to deal with all the red tape that a governmental agency has in place when this happens. One of the best ways to start moving forward with the IRS, however, is by filing those missing tax returns. Here are four reasons why you need to submit this missing paperwork right away.
To Create a Warming Relationship
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The first reason to file missing tax returns is to show you're making an effort to comply with IRS rules. This action can show that you're willing to do what's necessary to make this situation right. This can make the IRS more amenable to working with you to find a solution.
When you find yourself in tax debt trouble, it can often be beneficial to have a professional on your side. These professionals can help you take care of the paperwork for your missing returns to get it in as soon as possible. They also can let you know what your potential options are with the IRS in regard to handling your debt. Their guidance can potentially help you come to a better outcome, as they are very familiar with the process.
Open Up Your Options for a Payment Plan
One of the potential options for working with the IRS on the amount you owe for your tax debt is a payment plan. The problem with not filing all your tax returns is that the IRS won't consider a payment plan if you're not up-to-date with your paperwork. Turning in this late paperwork can help get the ball rolling toward setting up a payment plan agreement.
Improve Your Chances for a Settlement
Not only will having missing tax return forms stop you from creating a payment plan with the IRS, but it will also have a negative impact on achieving a settlement. The longer you wait to handle this paperwork, the more likely the IRS will be unwilling to work with you on your tax debt. This action can be a good-faith gesture that might make the agency more willing to consider your case for a settlement.
Adding More Debt to Your Balance
You'll also be potentially adding more debt to your balance by not filing these old tax returns. The IRS might not only charge you for the amount of taxes you didn't pay, but it might also levy fees and penalties against you. The longer it takes you to handle your late tax paperwork, the more expensive this experience can become. This delay makes the amount of money you'll have to pay back that much more significant and harder to handle.
To start fresh with the IRS, make sure everything in your past has been handled. Old tax returns that you never filed need to be filed as soon as possible. This gesture will help you square your records with the IRS and change the way you handle your taxes in the future.