As a taxpayer, you know that delaying and not paying taxes can only get you in precarious situations. However, our experience as one of the leading tax accounting firms in Texas at KF Tax & Accounting, P.C. has taught us that it’s common for many taxpayers to be unaware of the exact consequences this brings.
And, in our experience of bringing tax preparation service as well as accounting and bookkeeping services to the community, these are the common tax problems most will encounter for lack or delayed filings:
- Liability for penalties
Depending on whether you filed late, paid late, or paid fraudulently when you did pay, you can owe up to 25% to 75% of penalties from your unpaid tax.
- Liability for a federal crime
When failing to file a tax return is done with an overt act of evasion, it can be elevated to a felony, that is, a criminal tax violation.
- Lose out on exemptions, deductions, and credits
Even when you don’t file a refund, the IRS can file one for you through forms submitted by third parties and, because the IRS is understandably thorough, you will have no chance of getting reductions and other perks usually afforded to those who do file.
- Lose out on a potential refund
Are you entitled to a refund? If you are, filing late will not get you penalized, and you can still claim your refund. But you’re only given 3 years from the due date of your return to still be eligible for it.