While some people look forward to tax season all year long for the return that they have to look forward to, it isn’t the same for everyone. Some people dread this time of year because they have to be responsible for paying money to the IRS. This year especially, people are feeling a pinch financially and may not feel like they can afford to pay their taxes. Mark Dicus & Company is here to talk about what happens if you simply decide that you aren’t going to file your taxes this year.
What is the Penalty for Failure to File Taxes?
It may sound nice to have the ability to tell the IRS that finances aren’t what they used to be and you’re going to need a pass on filing your taxes this year. Unfortunately, that isn’t reality, and you get penalized when you don’t get those taxes filed. For each month you don’t pay, you will be charged 5% of your outstanding tax liability. On the second month, you will be charged $453 on top of that. For every month that you are late, you will be charged an additional 5% until you reach a maximum of 22.5% penalty. Of course, the penalties don’t just end there. The IRS piles it on even more as they charge you interest on the penalty, outstanding tax liability and any unpaid interest. As you can see, it can get out of control really quick.
Can the IRS Go Back More than 10 Years?
When you fail to pay your taxes, the IRS is only going to come after you for 10 years before they give up. It is important to note here that this doesn’t apply to filing your taxes. The IRS will come at you until the day you die for taxes that you haven’t filed. In fact, even after you have died, if there are any taxes that haven’t been filed, the executor of your will is in charge of getting them filed before the estate can be settled.
IRS Collection Methods
If you fail to pay your taxes, there are several ways the IRS can pursue you to get the money that you owe. Here are the ways IRS will work to get their money.
– Future Refunds
– Federal Tax Lien
– Deny Your Passport
– Tax Levy
– Summoned to Appear
– Outside Collection Agencies
– Criminal Charges
Tax Preparation, Filing, Resolution & More in Summerlin, North LV, Henderson, Lone Mountain Village & Greater Las Vegas, Nevada
As you can see, the IRS will not give up when it comes to getting you to file your taxes and pay taxes that you owe them. It is always better to have a good line of communication with the IRS and pay what you can. If you need extensions, you can always contact them and ask that you can be given an extension with a much smaller fee. At Mark Dicus & Company, we can help you navigate your taxes. Call us today!