File back tax returns with Advanced Tax Solutions
We offer Tax Preparation as far back as needed! We always have the old tax programs running to prepare taxes as far back as necessary.
Here is some useful information to know about how the IRS operates if you have some outstanding tax returns from prior years.
When filing previous year’s taxes, generally the IRS only requires that you file the last 6 years of tax returns. They will require this before they allow you to get into any kind of solution on outstanding tax liabilities. For example, if you owe $20,000 for 2012 and 2013, but you haven’t filed 2010 and 2006, the IRS would not allow you to set up a payment plan or file an Offer In Compromise for 2012 and 2013 because you have unfiled returns. This is true even if the IRS is levying your wages! However the only income tax return that they would require you to file is 2010 because 2006 is over 6 years old. Once you file 2010, you would be able to offer solutions on the outstanding balances.
Keep in mind that the IRS can file back tax returns for you if you haven’t filed. When the IRS files a return for you they generally use the “worst case scenario” for you when deciding how much you owe. If you have moved and haven’t received any notices from the IRS it is easy to be caught unaware. Once the IRS mails notice of the return to your last known address, even if you didn’t get it, it counts as notice and the liability stated on their prepared return becomes legally due. In circumstances like this, many times the poor client doesn’t even know there is a balance due until the IRS levies their bank accounts or garnishes their wages. This obviously becomes a real mess and everything has to move fast to undo the damage.
We help people all the time protest the returns that the IRS has filed. It’s always better to file for yourself before the IRS does it for you, but at least know that we can protest IRS prepared returns if they beat you to the punch. We recently assisted a taxpayer (you may have heard the taxpayer discussing this situation on the radio station KBPI not long ago) where the IRS prepared returns for him and showed a high 6 figure tax balance! We protested the return and the client really owed only about $3,000 (which included the penalties and interest!).
Another very important fact about unfiled returns is that the Statute of Limitations for getting a refund is 3 years from the due date of the return (plus extensions). Keep in mind it’s 3 years from the due date, not the tax year. As I write this in June of 2014 the statute for getting a refund from the government for 2010 has just expired (3 years from the April 15, 2011 due date of the return), unless you filed an extension for 2010, in which case you have until October 15, 2014. For more information regarding the statute of limitations and how it affects taxpayers please go to on our website.
A lot of times if you haven’t filed for many years you may not have the filing information such as W-2s, 1099s, bank interest and such. The good news is that we can get that from the IRS in a variety of ways. We can call the IRS and request it, or we can get it discretely by requesting the information from the IRS through the Freedom of Information Act. For more information on the Freedom of Information Act and the pros and cons of calling the IRS or filing a FOIA request, please go to on our website.
We have a lot of experience getting people back into the system when they haven’t filed in a long time. There are a lot of special nuances involved when old returns are outstanding, including the possibility of civil or criminal ramifications, so it really pays to get help. If you have outstanding old tax years that need attention, give us a call and take advantage of our free consultation. Call today and get your peace of mind back! 303-753-6040