August 24, 2007, Newsletter Issue #25: How To File Back Taxes

Tip of the Week

DebtHelp.com Tip: However you prepare your ‘regular’ income tax return is how you will be preparing and filing your back tax return. There are only a few differences:

If you are using a substitute tax form, be certain it is in compliance with IRS guidelines. Many times, you need prior approval. If you are using a substitute tax form, you will be mailing it to their special unit address.If you are using an IRS form, be certain it is for the correct year.File online, by mail, or through a tax preparer. Be certain you choose the correct year.Make certain you are using the tax rate tables in effect for the year you are filing for.Make certain the allowable deductions are applicable Know the limits and criteria of various credits, expenses, and special tax situation.(In short, know the tax laws applicable to the year you are reporting your back taxes). Develop any appropriate supporting documentation (schedules, letters, i.e.)If you have not filed for multiple years, the IRS usually does not go back further than six years for any examination (audit).Remember: The longer you wait to file your back taxes, the more penalty and interest is accumulating on your unpaid tax bill – in general. Wager earners note: You may want to contact the IRS if you are suspicious that your boss (employer) did not report your wages. Even though you did not receive any information from your employer, you still are liable for filing your tax return. Hopefully, you have pay stubs to verify your salary with applicable withholding taxes. Usually (if you can prove it), the IRS will give you credit for your withholding taxes even if they do not receive the information from your employer.

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