Back Tax Filing

All the taxpayers who haven’t paid their tax returns that are due should file all their tax returns whether or not full payment can be made along with the return. A taxpayer who files late for the tax returns is eligible for a payment plan. After plans are approved then all the plans for the payments require continued conformity with all filing and payment responsibilities.
There are certain facts about back tax filing:

• It can prove to be costly step for failing to file tax returns or filing late. It could increase the tax bill by 25% or more as a delay in back tax filing may cause penalty or interest charges as a consequence.
• If there is refund due there is no penalty if a failure results infilling tax returns. But delaying it for too long may lead to the loosing of the refund. Thus to receive a refund it must be filed within 3 years of the due date. If a return is filed by a person and it is later realized that there is an error in filing the return then to claim any refund the deadline is three years or if the tax was paid then the deadline is two years.
• If the person is self-employed then in order to receive the Social Security credits towards his/her retirement within three years of the due date the person must file returns reporting the self-employment income.
• A return must be filed to claim the Earned Income Tax credit by the taxpayers who are entitled to it. In order to receive the credit the return must be filed within two years of the due date.

A range of enforcement actions are likely to be taken if the taxpayers who continue not filing returns and fail to respond to IRS (Internal Revenue Service) requests. It may also lead to criminal prosecution if the non-conformity by repeat non-filers is continued.
There are certain significant mediums by which the IRS offers free assistance for the back tax filing such as computer, telephone or also in person. The IRS can answer to a number of questions of the taxpayers and also help them in getting forms, publications etc. If a wage earner has lost his/her W2 forms showing the person’s income and also income tax withholding, and if the person is not able to take out the duplicate copies from his/her employer then IRS after running the annual matching programs can readily provide the person with adequate information. After the season is up the matching programs are run, and by the late August the information is available in which the tax return is due.
A person can contact the IRS if he/she thinks that his/her employer did not report the person’s wages. Now if that person can prove the employer withheld that report on the taxes such as by providing pay stubs then the person will get the credit for social security and income tax even if IRS did not receive the withheld tax. But the person must still file the returns even if the employer fails to report the withheld taxes.
For the people of lower or middle income a program called VITA (Voluntary Income Tax Assistance) and IRS e-file some time ago joined hands to bring to VITA sites electronic filing of tax. Since then the volunteers have started preparing tax returns on the computers and finally transmit them to the IRS electronically. Some of the people should look for some professional assistance such as the individuals and joint tax filers whose income exceeds the VITA program criteria and also some business people. The IRS e-file provider database being authorized is a nationwide listing of all businesses which have been accepted to file in the IRS e-file or the electronic filing program.
For assisting the IRS with preparing a tax return, the taxpayers should bring all the information on the income and deductions for the tax years for which a record is returned to be filed. Here are some of the documents that may be needed are:

• Form W2 reported by the employer showing wages for the year.
• Form 1099 which reports self-employment income is obtained from banks and other financial institutions.
• Last tax return copy is filed.
• For the person who can prove to be dependent on others and also the dependent children are given a social security number.
• Certain items such as the itemized deductions, child care expenses or employ business expanses are to be claimed on the return information on expenses.