...Some people have the misconception that if you don't get a paycheck you don't have to file. Even if the only source of funds you receive is a social security check, sorry, you have to file your income taxes. But
millions of Americans fail to file and end up with an IRS tax debt they didn't expect- and can't afford to pay.
Whether you have to file is based on 4 requirements:
- gross income
- filing status
- marital status
- and age
Example of someone who doesn't
have to file:
A single person, over the age of 65 whose gross annual income is less than $10,050.
For the sake of argument
...But for the purpose this article we're going to assume that you did have to file taxes and you didn't. Now you have an IRS tax debt...so what can you do?
You've got to do what you've got to do
...Obviously you need to file those back taxes before the IRS files them for you. But here are some things the IRS Hitman can tell you about what you need to do to get those back taxes filed correctly, and keep the IRS from making your debt impossible.
Did you save that shoebox?
Your tax records are the key to getting your taxes filed correctly. However, depending on how far back your unfiled taxes returns go you may have lost or thrown away any of your records. The IRS can give you the information you would need for income earned, but what about any deductions or credits you think you deserve.
If you have property, your bank would be able to supply you with any information about your mortgage including interest on the mortgage which you can claim on your taxes.
Were you taking care of your grandkids? You would need school and doctor records to prove the child lived with you for at least 6 months of the tax year in question.
Do you get money back?
What if you file your back taxes and find out that you not only don't owe any money, but you are actually entitled to a refund? Hold your horses because you can only get refunds from back taxes that are from tax returns in the last 2 years. If a return is older than 2 years then you get nothing.
... DON'T let the IRS file for you. They won't file in your favor, so you can kiss any deductions goodbye. Additionally, Substitute for Returns (SFRs) cause a lot of problems when you try to resolve your tax debt issues. For example, you cannot file Bankruptcy for any tax the IRS filed SFRs for.