Taking Care of Back Taxes
Taking care of back taxes is something no one really looks forward to, and definitely a situation that no one ever hopes to find themselves faced with. It's a good thing then that taking care of back taxes isn't all that difficult if you know what to do, and how to go about it. Here are a few guidelines that you can use to help ensure that you are taking care of back taxes properly.
- There is no statute of limitations. Just because it can be fairly easy to take care of any back taxes that you may owe doesn't mean that you can simply blow it off till you want to handle it. The reason for this is rather simple and that is that there is no statute of limitations on back taxes. In fact the longer that you wait to file and take care of your back taxes then the larger your chances of having some potentially serious legal issues. So keep in mind that this is one case where you literally do not want to wait till tomorrow what you can begin today.
- Get all your paperwork. Start by gathering together all of your paperwork, tax records, receipts, and any and all paperwork that you need to file your taxes for the years that you haven't yet filed. Have them as neat and organized as you possibly can according to source, date you received them, and importance. This will come in handy when you begin the filing process.
- Professional help can be beneficial. If at all possible, hire a professional to help you out with taking care of your back taxes. This means that you need to hire a tax preparer to help you file the old tax forms. In fact, you really want to have a professional help you out since these guys are the ones that will have the software necessary for the particular years that you are dealing with. After all, whatever year you are filing the taxes for is going to be subject to the laws of that year. By using the proper software you can avoid any potential costly mistakes.
- You may still get a refund. Just because you have back taxes doesn't mean that you are going to be without a tax return. In fact it is a common misconception that people who haven't filed only owe money. The truth is that many times people who haven't filed are actually owed money (as in a tax return). However, you won't get this without filing the proper paperwork.
- Pay off what you owe immediately, and be prepared for the worst. When you file the tax paperwork for the years that you have missed, be prepared to pay off what you owe immediately. In the event that you cannot pay off what you owe immediately, then you will want to immediately set up a payment plan to take care of the money that is owed. Often the IRS will set up payment plans such as this to help people out. One thing that you will need to be prepared for when filing and taking care of back taxes is that you could potentially find yourself the subject of an audit. In the even that you do, make sure that you have a professional handy to help you through the process. Ideally, if you are faced with an audit you will want to have a tax attorney with you to offer advice.