Most adults need to file income tax returns. Doing helps reconcile their estimated payments and employer withholding amounts with the actual amount of taxes due for the most recent fiscal year.
The Internal Revenue Service (IRS) reviews reports from employers and financial institutions about income to identify discrepancies in individual tax returns and locate people who have not paid what they owe. Those accused of failing to file a federal tax return generally receive Form CP59 as their first notice of an unfiled income tax return. How can taxpayers address such a situation effectively?
Requesting relief through an extension
Ideally, people who may not be able to file a tax return by the annual due date in April know about the issue in advance. Sudden complications, such as a medical emergency or an employer failing to provide tax paperwork, could leave an individual unable to file their return on time.
They can then ask the IRS for an extension. Those who know they cannot submit their returns on time can file Form 4868 by April 15th to secure an extension. Taxpayers who follow the proper procedure then have until October 15th to file their returns and pay any outstanding balance due.
There may be other solutions available in cases where taxpayers do not notify the IRS in advance and receive a CP59 letter after the April 15th filing deadline for the year. Reviewing any unexpected correspondence from the IRS with a tax attorney can help people evaluate their options for handling the controversy.
Taxpayers who failed to file their annual returns on time may need assistance avoiding collection efforts and penalties that can significantly increase the amount of taxes they owe.