Approximately 7 million American taxpayers fail to file their tax returns each year – the tax experts at Optima Tax Relief review what to expect and tips for staying ahead of the potential outcomes related to failing to file.
A National Research Study conducted by the IRS found that approximately 7 million taxpayers fail to file their required income tax returns each year, compared with the 146 million taxpayers that do file. For those 5% who fail to file, and in turn fall out of compliance with their tax obligations to the IRS, what is in store? The tax experts at Optima Tax Relief reviews the consequences those taxpayers may expect as a result of not filing their income tax return.
There are many reasons so many Americans fail to follow the process and submit their tax return each year. For some Americans, they may simply not understand their tax status, and assume they are exempt. If you have any questions about your filing status, and are unsure if you are required to file an annual income tax return to the IRS, you can visit the IRS.gov website for help in determining your tax obligations.
If you have confirmed your tax status and your responsibility to file a return yet haven’t done so – either for the current year or previous years – the most important step to take is to expeditiously get the pending returns filed. There are a number of consequences, ranging in severity, which you may experience as a result of not filing your tax return – many of these issues become compounded the longer you wait to get your tax return filing up to date.
What can happen if I fail to submit my income tax return?
- Incur additional penalties, including a failure-to-file penalty
- Incur additional interest and penalties on all taxes not paid.
- Lose your return if you are eligible for one (if not filed within 3 year period)
- Delay the onset of the statute of limitations for the IRS to assess and collect outstanding tax debt.