This is a very popular question in our tax office and we get it often. “I have not filed my taxes for three years. Am I in trouble or what should I do?” Well, it is important to understand your obligations for sure.
Americans are supposed to file tax returns every year. When a year is skipped, it often is not picked up by the IRS right away, thus making it easier to skip the next filing year too. This is how it happens for many folks who are hard working, honest people. It is just time for them to get caught up now.
Individuals have 3 years from the due date of the return (without extensions) to file returns with the government, otherwise a potential refund form the tax year expires. For example, the 2016 personal income tax filing was due April 15, 2017 without extensions. Three years from that date is April 15, 2020. So, if the 2016 tax return is not filed by next April 15, 2020, any potential refund will be lost. Yes, believe it or not every year over $1 billion in unclaimed refunds reverts to the treasury from non-filed returns which would have been refunds!
Get with your advisor right away. We ask people to bring in their last filed tax return and any tax documents they may have for the current and missing years. We may contact the IRS for transcripts or any other information needed to help us process the missing years. It is important to know you are not alone. We can help you with this process and it is often not as painless as you think.
Please note: Filing your taxes is independent from paying your taxes. If you owe money for older tax years you need to pay it or make arrangements for a payment plan. To reach out to our office for a free review click here.
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About Stu: With more than 30 years of experience as a credentialed tax professional, Stu Steinberg brings a broad depth of knowledge to his work. Stu founded Erock Tax to help provide tax strategies to individuals, families and small businesses. He uses his CPA expertise to help each client navigate their every day tax and financial lives. Stu is passionate about empowering his clients through education about their tax health. He is highly energetic and brings a sense of optimism, creative problem-solving and a deep level of commitment to every Erock client.