Tax Payment and Filing Tax Returns

Unpaid taxes that are owed from previous years are what we call back taxes. A great predicament befalls those who fail to pay back taxes as required. However, revenue service gives the task of tax collection to a private collection agency that negotiates with the taxpayer who lacks the means to pay for a lesser settlement. This is through an offer in compromise with the revenue service either directly or via a tax attorney.

Back taxes are not the only problem that increases penalty but also unfiled tax returns. It costs so much to taxpayers who fail to file tax returns than even paying taxes. It is also possible that one cannot receive a refund of money that one is owed by a revenue service if enough time passes without filing tax returns and it is that serious. Hire the professionals from Settle Back Taxes Houston TX for easier processing.

A lot more consequences are witnessed for unfiled tax returns. First is unfiled tax return penalty. This is the hugest penalty that can be charged and actually costs an individual or a firm so much. It is usually a monthly penalty of 5% of total balances. It can be even up to 25% of the balance due. The interest penalty is one which is charged on unpaid balances. It may be up to 4% annually though it is updated on quarterly basis meaning that it might be more or less than 4% interest on unpaid balances. Failure to pay tax penalty goes up to 0.5% of the total balance every month.

Anyone who lacks the means to pay back taxes still have the opportunity to file tax returns to avoid accumulation of penalties especially that which involves Unfiled Tax Returns Clifton TX which is much greater. Unfiled tax returns fetches not only massive penalties but also possible imprisonment when the revenue service take one in a court of law. However, it is usually not likely that one is prosecuted if willing to file old tax returns.

It is never too late for a willing part to file old tax returns. One will need the required documents while filing the old tax returns. The possible place to get this document is the previous place of work, and if not found, the revenue service might be having these documents. After getting the documents, get tax forms prepared. This can be done by the firm one works in or by the individual. Specific data is required for the years missed. After this, one can now file the returns and send the files to the usual address tax returns are sent to or send to one advised by the revenue service. After filing, it is necessary to pay the back taxes one is owed to be free from any kind of penalties. One may consult qualified auditors for more information. Bank levies involves seizure of property when on fails to pay taxes.