I represent taxpayers in Sarasota and throughout Florida who have federal and state tax issues. I have recently seen an uptick in the number of people contacting me who have not filed tax returns, some for many years. In fact, the non-filer issue is a priority for the IRS and they recently announced that they will increase face-to-face visits to high-income taxpayers who have not filed tax returns for prior years in an effort to increase tax compliance.
More importantly, it is worth noting that the willful failure to file a tax return is a federal tax crime under the Internal Revenue Code Section 7203.
So, what can non-filers do, and how can we help them get their tax return issue resolved with the IRS? It depends on why they failed to file a return in the first place.
If the failure to file the tax returns was due to a lack of money (i.e., they realized they would be unable to pay the tax liability shown as due on the tax return and therefore, chose not to file) then we can get those tax returns filed and begin working on a tax resolution for them to resolve the back tax balance. Possible resolutions could include an Installment Agreement, Offer-in-Compromise (“OIC”), or have their account placed in uncollectable status.
If the taxpayer’s failure to file was intentional for other reasons, such as cash payments to undocumented workers, then the way to resolve the issue and avoid a criminal tax referral is by utilizing the IRS’s Voluntary Disclosure Program. By committing to a voluntary disclosure, the taxpayer can come in and disclose the issue without fear of a criminal tax referral.
If you, or someone you know has unfiled tax returns or some other federal or state tax issue, please feel free to contact me by telephone at 813-463-8348 or by email at firstname.lastname@example.org.
John S .Wood, CPA
1990 Main Street
Sarasota, FL 34236