Whether you live in the U.S. or overseas, it’s vital to file all of your overdue taxes before you get into trouble – trust us, living abroad won’t help you against the IRS when it comes to this matter. Thankfully, filing your back taxes is easier than you may think, and doing so is definitely worth the effort. Here are some simple tips to get you started.
Gather All The Relevant Documents
Figure out the last year you filed, and find any copies you may have of your tax return. It’s vital to find the W-2s and other tax documents for the years you need to file. If you are missing any crucial documents, you can always request copies from the IRS for free.
Prepare Your Tax Returns
You won’t even know if you’re getting a tax refund or owe the IRS anything until you (or your tax professional) have prepared your tax returns.
Protect Your Tax Refunds
Keep in mind that there are strict time limits for refunds, audits, and debt collection, so make an estimate for how long it will take to get your refund checks. If you owe other tax debts, you need to know how much of your refunds will be applied to other tax years. If you think you might owe next year, consider making estimated tax payments to avoid the problem ahead of time.
Pay Off Your Tax Debts
It’s best to create a plan on how to pay off any tax debts. This plan may be as simple as setting up a monthly payment plan, or writing a check for the full amount. Regardless,
you want to have some sort of plan, because you can’t ignore the IRS forever.
Know Your Tax Law!
There are three provisions of U.S. tax law that are relevant to this situation. Knowing them helps tremendously in paying off your back taxes.
First, sometimes the IRS will estimate your tax liability and either send you a notice of proposed assessment, or even file a return on your behalf. This may sometimes be more than you actually owe, so reduce or eliminate the IRS proposed assessments by filing your back tax returns.
Second, there are strict time limits for getting a refund, collecting on tax debts, and for auditing your tax returns That’s why it’s important to look up the IRS Statute of Limitations.
Finally, the IRS has the authority to impose penalties and interest on tax liabilities not paid in full by the deadline for the tax return. Learn how these IRS penalties and interests are calculated and what you can do to minimize them.
Hire a Tax Professional
Although like most expats, you’re probably the savvy and adventurous type, that mean you should dive into tax returns on your own. Expat Taxes are not only complicated, but subject to rapid changes and fine print that even the sharpest folks can miss. Save yourself time, money, and energy by turning to the Online Taxman.
We exist strictly for the provision of professional Expat Tax Services. We focus only on this area, guaranteeing you the utmost efficiency and expertise. Learn why so many American expatriates from all over the world have been relying on us for years. Call 1-855-682-9626 for more details.