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What to Do If You Forgot to File Your Tax Return

Many taxpayers forget to file their tax returns every year. This could happen for several reasons:

  • You completed your tax return and thought you submitted it to the IRS, but you never did.
  • The IRS rejected your return and you did not resubmit it.
  • You were distracted by health problems, financial problems, or some other issues.
  • You simply forgot to do your taxes.

If you were required to file a return and didn’t, you should complete and submit your return as soon as possible to minimize your penalties and other consequences.

Unfiled Returns When Tax is Owed

If you owed taxes on your return, you’ll face several penalties:

  • The failure to pay penalty, which is generally 0.5% of the tax due each month.
  • The failure to file penalty, which is 5% of the tax due each month.
  • Interest that accrues each month at rates set by the IRS.

You’ll also need to pay your back taxes. If you can’t pay all of these amounts in full, you may request an IRS installment agreement make monthly payments. You may also be able to seek penalty relief to reduce how much you owe in tax penalties.

Unfiled Returns When a Refund is Due

If you are owed a tax refund, you won’t face any penalties for failing to file your return. However, you need to file the return within three years of the return’s due date (usually April 15) to receive your refund. After that, you are no longer eligible to receive your tax refund.

Even if you didn’t overpay in tax withholdings, you may still get a tax refund if you qualify for certain refundable tax credits, such as the Earned Income Credit. You need to file a return to receive a refund, even if you aren’t legally required to file.

Other Consequences

The longer you wait to file your return, the more likely it is you’ll face additional consequences. Your penalties will continue to accrue. Eventually, the IRS can file a tax return on your behalf which is known as a Substitute for Return (SFR).

Once the SFR is filed, the IRS can assess tax and then seek to collect it. Your bank account could be levied or your wages could be garnished if you don’t pay your tax and work out a deal with the IRS.

Avoid these problems by filing your tax returns as soon as possible and contacting a tax attorney to discuss your tax repayment options.

The Gartzman Law Firm handles tax debt settlement, tax audit defense, and other tax resolution cases. Use our contact form to request a consultation with an Atlanta tax resolution attorney.