Don't Panic! How To Deal With Filing Your Taxes Late

Did you happen to forget to file your taxes this year? And, potentially, in prior years? First of all: don't panic. This happens quite a lot. Some people just don't realize that they need to file taxes; they may think that they're under the reporting amount, or they might have falsely believed that someone else filed for them. Regardless, you do need to deal with the situation as soon as possible, but it isn't the world ending scenario you might think it is.

Call the Internal Revenue Service As Soon As Possible

The first thing you need to do is contact the IRS. It may seem frightening, but the IRS is usually more than willing to work with you. Let them know that you are working on your returns and when they will be submitted. This is important because the IRS is one of the few institutions that can (and will) freeze your bank accounts if you owe them enough in estimated taxes. Unlike private entities, the IRS does not need a court judgment to do this.

Get Your Prior Year Returns Ready

If you have prior year returns that you didn't complete, you're going to have a minor complication: you can't electronically file them. That means you can't just load up a tax website and send your documents in. You need to go to an accountant or work directly on paper forms for tax preparation -- something that can be very daunting. You'll want to work on your oldest return first and work your way slowly to the most recent return, which can usually be electronically filed.

Arrange a Payment Plan

At this stage, it's very likely that you owe a substantial amount to the IRS. But luckily for you, the IRS is very open to payment plans, and their interest rates are quite low. You can arrange a payment plan with the IRS (and sometimes get some penalties and fines waived) by either talking to them directly or through your accountant. You will then fill out a simple payment plan request form, which you can then pay in intervals following your filing. 

Above all, you should always get an accountant to look over your returns. If you're filing your returns all at once, you may undergo a more intense level of scrutiny from the IRS than you would otherwise. You also want to make sure that your taxes are correct and that you can save as much money as possible. Your accountant will also be able to interface with the Internal Revenue Service on your behalf, which a major benefit.