Do I File my Tax Returns if I don’t have money to pay?

YES!  Effective January 1, 2020 the IRS will start penalizing Individuals $330 for Form 1040 Tax Returns due after December 31, 2019, but only if you owe money

If you are due a refund, you will receive your refund without interest when you do decide to file.  The IRS only refunds tax payers on late filed returns up to 3 years back.

The IRS knows if you owe them money.  All W2’s and Form 1099’s are recorded and sent to the IRS annually.  They know your income big or small.  They know your mortgage interest and possible income in your stock sales.

You may as well file your Form 1040 Tax Return timely.  You are not helping yourself by not submitting.

A client came into our office in December of 2018 and had not filed a Tax Return since April of 2009.  His wife died in 2010 and a “family friend”, not a tax preparer, told the gentlemen that he did not need to file a Form 1040 Tax Return.

What the “family friend” did not know was that the client was having Federal and State taxes withheld from his Pension and Social Security Benefits that exceeded the taxes owed.

In other words, the client gave up $18,238 in tax refunds that he could have collected for Tax Years 2010 to 2015. In 2017, the same gentlemen was penalized for not filing his 2017 Form 1040 because he owed money to the IRS.

It never pays to not file your Tax Return – However you look at it.

Facing a Tax Audit?
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