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Not filing a tax return could lead to complications

On Behalf of | May 17, 2020 | Tax Controversies |

The issues that can come about relating to tax matters are, unfortunately, numerous. Some New York residents may simply want to pass up the task of filing their tax paperwork altogether, but that is not necessarily a wise choice. The IRS can still attempt to collect taxes even if a person does not file a tax return, which is less than ideal.

When individuals file their own returns, they can deduct their allowable credits, and if the IRS must determine how much a person owes, the agency will not take deductions into account. The person will receive a notice of deficiency and a substitute return, which is the document that the IRS essentially filled out on behalf of the taxpayer. The person can accept that return, send back one that he or she completed, or explain why a return is not necessary.

If a person continues not to take action, the IRS will send notice that the person should pay the amount determined by the substitute return. In the event that the person does not pay that amount, the IRS will make collections attempts. Any continued lack of payment could eventually lead to fees and other penalties or even criminal charges if a person is suspected of tax evasion or other wrongdoing.

Not filing a tax return may seem like a good idea to some individuals who are worried about their tax situation, but it could simply make matters more complicated. If New York residents have a valid reason for not filing but still receive collection notices from the IRS, they may need to take additional steps to address the issue. It may be wise to contact attorneys experienced in tax laws to gain information.